FORGING AHEAD - Tradewinds Plantation Berhad

Level 9, Menara HLA 

No. 3, Jalan Kia Peng, 50450 Kuala Lumpur 

Tel: 03-2177 9999 • Fax: 03-2161 1701 

Web: www.tpb.com.my 

a n n u a l r e p o r t 2 0 1 0 t r a d e w i n d s p l a n t a t i o n b e r h a d ( 6 5 0 2 3 4 - A ) 

FORGING AHEAD 

Achieving STRATEGIC GROWTH 

Annual Report 2010

CONTENTS 

STATUTORY 

REPORTING 

04 Notice of Annual General 

Meeting 

08 Statement Accompanying 

Notice of Annual General 

Meeting 

10 Group Financial Highlights 

CORPORATE 

INFORMATION 

16 Financial Calendar 

17 Group Half-Yearly Results 

18 Corporate Information 

20 Board of Directors 

27 Management Team 

30 Group Corporate Structure 

PERFORMANCE 

REVIEW 

36 Chairman’s Statement 

44 Business Review by 

Chief Executive Officer 

7TH ANNUAL GENERAL MEETING 

Date : Tuesday, 21 June 2011 

Time : 9.30 a.m. 

Venue : Mahkota Ballroom 2 

Ballroom Level 

Hotel Istana Kuala Lumpur 

73 Jalan Raja Chulan 

50200 Kuala Lumpur

CORPORATE 

GOVERNANCE 

56 Statement on Corporate 

Governance 

64 Statement on Internal Control 

68 Audit Committee Report 

72 Additional Compliance 

Information 

CORPORATE 

SOCIAL 

RESPONSIBILITY 

80 Corporate Social Responsibility 

85 Safety, Health, Environment 

and Quality 

FINANCIAL 

STATEMENTS 

90 Financial Statements 

OTHER 

INFORMATION 

219 Plantation Review 

220 Location of the Group Estates 

and Palm Oil Mills 

221 Material Properties of Tradewinds 

Plantation Berhad Group 

229 Analysis of Shareholdings 

233 Analysis of Irredeemable 

Convertible Unsecured Loan 

Stocks (ICULS) 

236 Directory of Group Operation 

240 Notice of Nomination of Auditors 

• Proxy Form 

TRADEWINDS 

PLANTATION BERHAD 

Annual Report 2010 


The theme for Year 2010 illustrates Tradewinds Plantation Berhad’s unwavering aspirations to be a key player in the local oil 

palm industry. We are confident of achieving improved performance as we forge ahead with optimism and confidence. 

Leveraging on our accumulated strengths borne from solid foundations built over the years. 

Our journey of continuity is clearly defined as we are set to achieve and sustain long-term growth. Lending credence to our 

ambition of developing and expanding our core businesses across the region through industrial strength and expertise.

STATUTORY 

REPORTING

4 

STATUTORY REPORTING 

NOTICE OF 

ANNUAL GENERAL MEETING 

NOTICE IS HEREBY GIVEN that the Seventh Annual General Meeting 

of Tradewinds Plantation Berhad will be held at Mahkota Ballroom 2, 

Ballroom Level, Hotel Istana Kuala Lumpur, 73 Jalan Raja Chulan, 

50200 Kuala Lumpur on Tuesday, 21 June 2011 at 9.30 a.m. for the 

following purposes:- 

As Ordinary Business, to consider and if thought fit to pass the following resolutions: 

ORDINARY RESOLUTIONS 

1. To receive and adopt the Audited Financial Statements for the financial year ended 31 December 

2010 together with the Reports of the Directors and Auditors thereon. 

2. To declare a Final Dividend of 5% per share less 25% income tax for the financial year ended 31 

December 2010. 

3. To approve the payment of Directors’ fees for the financial year ended 31 December 2010. 

4. To re-elect the following as Directors of the Company who are required to retire from office 

pursuant to Article 105 of the Company’s Articles of Association: 

i) Encik Bakry bin Hamzah 

ii) Encik Mohd Nazri bin Md. Shariff 

5. To re-appoint Dato’ Wira Syed Abdul Jabbar bin Syed Hassan pursuant to Section 129(6) of the 

Companies Act, 1965, as Director of the Company to hold office until the conclusion of the next 

Annual General Meeting. 

6. To appoint Auditors of the Company for the ensuing year and to authorise the Directors to fix their 

remuneration. 

Notice of Nomination pursuant to Section 172 (11) of the Companies Act, 1965, a copy of which 

is included in the Annual Report 2010 has been received by the Company for the nomination of 

Messrs Deloitte KassimChan, who have given their consent to act, for appointment as Auditors 

and of the intention to propose the following ordinary resolution:- 

“THAT Messrs Deloitte KassimChan be and are hereby appointed as Auditors of the Company in 

place of the retiring Auditors, Messrs BDO to hold office until the conclusion of the next Annual 

General Meeting at a remuneration to be determined by the Board of Directors.” 

TRADEWINDS PLANTATION BERHAD 


RESOLUTION 1 

RESOLUTION 2 

RESOLUTION 3 

RESOLUTION 4 

RESOLUTION 5 

RESOLUTION 6 

RESOLUTION 7

7. As Special Business, to consider and if thought fit to pass the following as Ordinary Resolutions: 

PROPOSED SHAREHOLDERS’ MANDATES FOR TRADEWINDS PLANTATION BERHAD AND ITS 

SUBSIDIARY COMPANIES (COLLECTIVELY, THE “GROUP COMPANIES”) TO ENTER INTO RECURRENT 

RELATED PARTY TRANSACTIONS OF A REVENUE OR TRADING NATURE SPECIFIED IN THE 

CIRCULAR TO SHAREHOLDERS DATED 30 MAY 2011 (THE “CIRCULAR”) 

PROPOSED CATEGORY A MANDATE 

“THAT approval be and is hereby given for the Group Companies to enter into the recurrent related 

party transactions of a revenue or trading nature specified and set out in Section 3.2 of the Circular 

(the “Category A Mandate”) provided that such transactions are (i) in the ordinary course of business 

and necessary for day-to-day operations of the Group Companies and (ii) on normal commercial terms 

which are not more favourable to the related parties than those generally available to the public, and 

are not to the detriment of the minority shareholders of the Company AND THAT unless revoked or 

varied by the resolutions of the shareholders of the Company in general meeting, the Category A 

Mandate shall continue to be in force until the conclusion of the next Annual General Meeting of the 

Company or the expiration of the period within which the next Annual General Meeting is required to 

be held pursuant to Section 143(1) of the Act (but shall not extend to such extensions as may be 

allowed pursuant to Section 143(2) of the said Act) whichever is the earlier. 

AND FURTHER THAT the Group Companies be and are hereby authorised to enter into and execute all 

such agreements, instruments, documents and deeds and to do all acts, deeds and things necessary, 

expedient or advisable for and in respect of the Category A Mandate and the transactions contemplated 

and/or authorised by the Category A Mandate. 

PROPOSED CATEGORY B MANDATE 

“THAT approval be and is hereby given for the Group Companies to enter into the recurrent related 

party transactions of a revenue or trading nature specified and set out in Section 4.2 of the Circular 

(the “Category B Mandate”) provided that such transactions are (i) in the ordinary course of business 

and necessary for day-to-day operations of the Group Companies and (ii) on normal commercials terms 

which are not more favourable to the related parties than those generally available to the public, and 

are not to the detriment of the minority shareholders of the Company AND THAT unless revoked or 

varied by the resolutions of the shareholders of the Company in general meeting, the Category B 

Mandate shall continue to be in force until the conclusion of the next Annual General Meeting of the 

Company or the expiration of the period within which the next Annual General Meeting is required to 

be held pursuant to Section 143(1) of the Act (but shall not extend to such extensions as may be 

allowed pursuant to Section 143(2) of the said Act) whichever is the earlier. 




RESOLUTION 8 

RESOLUTION 9 

5

NOTICE OF 

ANNUAL GENERAL MEETING 

AND FURTHER THAT the Group Companies be and are hereby authorised to enter into and execute all such agreements, 

instruments, documents and deeds to do all acts, deeds and things necessary, expedient or advisable for and in respect of the 

Category B Mandate and the transactions contemplated and/or authorised by the Category B Mandate. 

8. To transact any other ordinary business for which due notice shall have been given in accordance with the Companies Act, 

1965. 

NOTICE OF BOOk CLOSURE AND NOTICE OF DIvIDEND ENTITLEMENT AND PAYMENT 

NOTICE IS HEREBY GIVEN that a Final Dividend of 5% per share less 25% Income Tax in respect of the financial year ended 31 

December 2010, if approved by the shareholders at the forthcoming Annual General Meeting, will be paid on 28 July 2011, to 

the shareholders whose names appear on the Company’s Register of Depositors on 12 July 2011. 

A depositor shall qualify for entitlement to the Final Dividend only in respect of: 

(a) Shares transferred into the Depositor’s Securities Account before 4.00 p.m. on 12 July 2011 in respect of ordinary transfers; 

(b) Shares bought on Bursa Malaysia Securities Berhad on a cum entitlement basic according to the Rules of the Bursa Malaysia 

Securities Berhad. 

By Order of the Board 

ZAINAL RASHID BIN AB RAHMAN (LS 007008) 

Secretary 

Kuala Lumpur 

30 May 2011 

6 



Annual Report 2010

NOTES: 

1. A member of the Company entitled to attend and vote at the Meeting is entitled to appoint any person to be his proxy 

without limitation to attend and vote in his stead and the provisions of Section 149(1)(a) and (b) of the Companies Act, 

1965 shall not apply to the Company. A Member shall not be entitled to appoint more than two (2) proxies to attend and 

vote at the same meeting. Where a Member appoints two (2) proxies, then appointments shall be invalid unless he specifies 

the proportions of his holdings to be represented by each proxy. A proxy may but need not be a member of the Company. 

2. Where a member of the Company is an authorised nominee as defined under the Central Depositories Act, it may appoint 

at least one (1) proxy in respect of each securities account it holds with ordinary shares of the Company standing to the 

credit of the said securities account. 

3. To be valid, this Proxy Form must be deposited with the Share Registrar of the Company, Symphony Share Registrars Sdn 

Bhd, at Level 6, Symphony House, Pusat Dagangan Dana 1, Jalan PJU 1A/46, 47301 Petaling Jaya, Selangor not less than 

48 hours before the time fixed for holding the Meeting or at any adjournment thereof. 

4. In the case of a corporate member, the corporation may by resolution of its directors or other governing body, if it is a 

Member of the Company, authorise such person as it thinks fit to act as its representative either at a particular meeting or at 

all meetings of the Company or of any class of Members, and a person so authorised shall in accordance with his authority 

and until his authority is revoked by the corporation be entitled to exercise it as if it were an individual Member of the 

Company. 

5. The instrument appointing a proxy shall be in writing under the hand of the appointer or of his attorney duly authorised in 

writing or, if the appointer is a corporation, whether under its seal or under the hand of an officer or attorney duly authorised. 

6. Further details of individuals standing for re-election as Directors of the Company as per Resolutions 4, 5 and 6 are shown 

on pages 22 to 25 of the Annual Report 2010. 

EXPLANATORY NOTES ON SPECIAL BUSINESS: 


Resolution 8 and 9 proposed, if passed, will allow the Company and its subsidiaries to enter into recurrent related party 

transactions in accordance with paragraph 10.09 of the Main Market Listing Requirements of Bursa Malaysia Securities Berhad 

and the necessity to convene separate general meetings from time to time to seek shareholders’ approval as and when such 

recurrent related party transactions occur would not arise. For further information, please refer to the Circular to Shareholders 

dated 30 May 2011 accompanying the Company’s Annual Report for the financial year ended 31 December 2010. 



7

8 


STATEMENT ACCOMPANYING 

NOTICE OF ANNUAL GENERAL MEETING 

Made pursuant to Paragraph 8.27 (2) of the Main Market Listing Requirements of Bursa Malaysia 

Securities Berhad 

1. Directors who are standing for re-election at the 7th Annual General Meeting are as follows: 

1.1 The Directors retiring by rotation pursuant to Article 105 of the Company’s Articles of 

Association and seeking re-election are as follows: 

i. Encik Bakry bin Hamzah 

ii. Encik Mohd Nazri bin Md. Shariff 

1.2 Dato’ Wira Syed Abdul Jabbar bin Syed Hassan is seeking re-appointment pursuant to 

Section 129(6) of the Companies Act, 1965, to hold office until the conclusion of the next 

Annual General Meeting of the Company. 

2. The profiles of the above Directors who are standing for re-election are set out on pages 22 to 25 

of this Annual Report 2010. The Directors’ shareholdings in the Company are set out in the 

Analysis of Shareholdings which appear from page 229 to 235 of this Annual Report 2010. 

3. A total of six (6) Board Meetings were held during the financial year ended 31 December 2010. 

The details of attendance of Directors at the said Board Meetings up to 31 December 2010 are 

stated in their respective profiles on pages 22 to 25 of this Annual Report 2010. 

4. The 7th Annual General Meeting of Tradewinds Plantation Berhad will be held as follows: 

vENUE: 

Mahkota Ballroom 2 

Ballroom Level 

Hotel Istana Kuala Lumpur 

73 Jalan Raja Chulan 

50200 Kuala Lumpur 

DATE: 

21 June 2011 

TIME: 

9.30 a.m. 


Annual Report 2010




9

GROUP FINANCIAL 

HIGHLIGHTS 

2010 2009 2008 2007 2006# 

FINANCIAL PERFORMANCE RM’000 RM’000 RM’000 RM’000 RM’000 

Revenue 

Earnings before interest, tax, depreciation and 

909,126 677,424 809,987 652,899 361,100 

amortisation (EBITDA) 411,488 202,980 324,846 272,334 109,190 

Profit before tax 282,408 78,347 199,787 159,231 14,132 

Profit for the year 211,956 54,394 151,487 133,255 14,418 

Profit attributable to owners of the Parent 186,404 51,545 138,369 121,668 18,479 

Equity attributable to owners of the Parent 1,520,780 1,377,056 1,350,246 1,234,569 1,124,869 

Total assets 3,015,179 2,888,921 2,712,763 2,329,945 2,292,148 

Total borrowings 873,565 940,921 816,895 624,960 641,394 

Issued and paid-up capital 529,153 529,153 529,153 529,153 529,153 

RATIO 

Return on equity 12.3% 3.7% 10.2% 9.9% 1.6% 

Return on total assets 6.2% 1.8% 5.1% 5.2% 0.8% 

Return on revenue 20.5% 7.6% 17.1% 18.6% 5.1% 

Gross dividend per share (sen) 10.00 6.00 6.00 6.00 3.00 

Basic earnings per share (sen) 29.63 8.19 21.99 19.34 3.49 

Net assets per share (RM) 2.87 2.60 2.55 2.33 2.13 

10 


# Represents 10 months performance as the Group was only established on 28 February 2006 


Annual Report 2010

REVENUE AND 

PROFIT BEFORE TAX 

2010 

2009 

2008 

2007 

2006# 

282,408 

78,347 

199,787 

159,231 

14,132 

361,100 

RETURN ON TOTAL ASSETS AND 

RETURN ON EQUITY 

2010 

2009 

2008 

2007 

2006# 

Revenue (RM’000) 

Profit Before Tax (RM’000) 

0.8 

1.8 

1.6 

3.7 

5.1 

5.2 

361,100 

6.2 

Return on Total Assets (%) 

Return on Equity (%) 

677,424 

652,899 

10.2 

9.9 

809,987 

909,126 

12.3 

TOTAL ASSETS AND EQUITY ATTRIBUTABLE TO 

OWNERS OF THE PARENT 

2010 

2009 

2008 

2007 

2006# 

1,520,780 

1,377,056 

1,350,246 

1,234,569 

1,124,869 

2,329,945 

2,292,148 

BASIC EARNINGS PER SHARE AND 

GROSS DIVIDEND PER SHARE 

2010 

2009 

2008 

2007 

2006# 

3.0 

3.49 

6.0 

6.0 

6.0 

8.19 

10.0 

Basic Earnings Per Share (sen) 

Gross Dividend Per Share (sen) 



19.34 

2,712,763 

3,015,179 

2,888,921 

Total Assets (RM’000) 

Equity Attributable to Owners of the Parent (RM’000) 

21.99 



29.63 

11

STRATEGIC 

INVESTMENTS 

We will remain steadfast on investing in new landbanks, plantation 

development and strategic acquisitions that will evidently enlarge our 

plantations operations and place the organization in a position that is 

better and more favorable to realize future potentials as well as attain 

sustainable growth.

CORPORATE 

INFORMATION

16 

CORPORATE INFORMATION 

FINANCIAL 

CALENDAR 

ANNOUNCEMENT OF FINANCIAL RESULTS 

1st quarter 

of 2010 

announced 

21 May 2010 



2nd quarter 

of 2010 

announced 

18 August 2010 

3rd quarter 

of 2010 

announced 

19 November 2010 

DIVIDENDS FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2010 

First Interim Dividend 

announced 

19 November 2010 

Final Dividend 

announced 

18 February 2011 

GENERAL MEETINGS 

6th Annual General 

Meeting 

17 June 2010 

of 5% per share less 

entitlement date 

16 December 2010 

of 5% per share less 

entitlement date 

12 July 2011 

Issue of Annual 

Report 2010 

30 May 2011 

25% Income Tax 

payment date 

30 December 2010 

25% Income Tax 

payment date 

28 July 2011 

7th Annual General 

Meeting 

21 June 2011 

4th quarter 

of 2010 

announced 

18 February 2011

GROUP HALF-YEARLY 

RESULTS 


6 MONTHS ENDED 6 MONTHS ENDED 12 MONTHS ENDED 

30 JUNE 2010 31 DECEMBER 2010 31 DECEMBER 2010 

RM’000 % RM’000 % RM’000 % 

Revenue 376,833 41 532,293 59 909,126 100 

Profit from operations 99,800 32 208,448 68 308,248 100 

Profit before tax 84,333 30 198,075 70 282,408 100 

Tax expense 27,362 39 43,090 61 70,452 100 

Profit after tax 

Profit attributable to owners 

56,971 27 154,985 73 211,956 100 

of the Parent 52,781 28 133,623 72 186,404 100 

Basic earnings per share (sen) 8.39 28 21.24 72 29.63 100 

Gross dividend per share (sen) — — 10.0 100 10.0 100 



17

18 


CORPORATE 

INFORMATION 



BOARD OF DIRECTORS 

Independent Non-Executive Chairman 

Dato’ Wira Syed Abdul Jabbar bin 

Syed Hassan 

Independent Non-Executive Directors 

Ooi Teik Huat 

Pakhruddin bin Sulaiman 

Non-Independent Non-Executive Directors 

Bakry bin Hamzah 

Chuah Seong Tat @ Chuah Chee Tat 

Mohd Nazri bin Md. Shariff 

AUDIT COMMITTEE 

Chairman 

Ooi Teik Huat 

Members 



EXECUTIVE COMMITTEE 

Chairman 


Syed Hassan 

Members 


Chuah Seong Tat @ Chuah Chee Tat

NOMINATION & 

REMUNERATION COMMITTEE 

Chairman 


Syed Hassan 

Members 

Ooi Teik Huat 


COMPANY SECRETARY 

Zainal Rashid bin Ab Rahman 

LS007008 

REGISTERED OFFICE 


No. 3, Jalan Kia Peng 


Tel : 03 - 2177 9999 

Fax : 03 - 2161 1701 

AUDITORS 

Messrs BDO 

12th Floor, Menara Uni.Asia 

1008 Jalan Sultan Ismail 


Tel : 03 - 2616 2888 

Fax : 03 - 2616 3190 / 2616 3191 

SHARE REGISTRAR 

Symphony Share Registrars Sdn Bhd 

Level 6, Symphony House 

Pusat Dagangan Dana 1 

Jalan PJU 1A/46 

47301 Petaling Jaya 

Selangor 

Tel : 03 - 7841 8000 

Fax : 03 - 7841 8152 

SOLICITORS 

Messrs Azmi & Associates 

Messrs Lee Hishammuddin Allen 

& Gledhill 

Messrs Martin Cheah & Associates 

Messrs Reddi & Co. 

BANKERS 

Alliance Bank Malaysia Berhad 

AmBank (M) Berhad 

Bank Muamalat Malaysia Berhad 

CIMB Bank Berhad 

EON Bank Berhad 

Malayan Banking Berhad 

OCBC Bank (Malaysia) Berhad 

Public Bank Berhad 

RHB Bank Berhad 


STOCK EXCHANGE LISTING 

Main Board of Bursa Malaysia 

Securities Berhad 

STOCK NAMES 

Ordinary Shares: TWSPLNT 

Irredeemable Convertible Unsecured 

Loan Stocks (ICULS): TWSPLNT-LA 

STOCK CODES 

Ordinary Shares: 6327 

ICULS: 6327la 

INTERNATIONAL SECURITIES 

IDENTIFICATION NUMBER (ISIN) 

Ordinary Shares: MYL 6327OO 000 

ICULS: MYL 6327LAQ 21 



19

20 


BOARD OF 

DIRECTORS 

PAKHRUDDIN BIN SULAIMAN 

Independent Non-Executive Director 



OOI TEIK HUAT 


DATO’ WIRA SYED ABDUL JABBAR 

BIN SYED HASSAN 

Independent Non-Executive Chairman

BAKRY BIN HAMZAH 

Non-Independent Non-Executive 

Director 

CHUAH SEONG TAT @ 

CHUAH CHEE TAT 


Director 


MOHD NAZRI BIN MD. SHARIFF 


Director 



21

22 


BOARD OF 

DIRECTORS 



Dato’ Wira Syed Abdul Jabbar bin Syed Hassan, aged 71, was appointed to the 

Board of Directors of Tradewinds Plantation Berhad on 27 June 2006 and has 

served as Chairman of the Company since then. He is also the Chairman of the 

Executive Committee and the Nomination and Remuneration Committee. 

Dato’ Wira Syed Abdul Jabbar bin Syed Hassan holds a Bachelor of Economics 

degree from the University of Western Australia and Masters in Marketing from the 

University of Newcastle-Upon-Tyne, United Kingdom. He was the Chief Executive 

Officer of the Kuala Lumpur Commodity Exchange from 1980 to 1996, the Executive 

Chairman of the Malaysia Monetary Exchange from 1996 to 1998 and subsequently 

from 1998 to 2000, the Executive Chairman of the Commodity and Monetary 

Exchange. 

Currently, Dato’ Wira Syed Abdul Jabbar bin Syed Hassan is the Chairman of 

Tradewinds (M) Berhad, MMC Corporation Berhad, MARDEC Berhad, Padiberas 

Nasional Berhad and Aliran Ihsan Resources Berhad. He also sits on the Board of 

Directors of Star Publications (M) Bhd and KAF Investment Bank (M) Bhd. 

Dato’ Wira Syed Abdul Jabbar bin Syed Hassan has attended all six (6) Board 

Meetings held during the financial year ended 31 December 2010. 

DATO’ WIRA SYED 

ABDUL JABBAR BIN 

SYED HASSAN 

Independent Non-Executive 

Chairman

OOI TEIK HUAT 


Director 

Mr. Ooi Teik Huat, aged 51, was appointed to the Board of Directors of Tradewinds 

Plantation Berhad on 25 January 2006. He is the Chairman of the Audit Committee and is 

also a member of the Nomination and Remuneration Committee. 

Mr. Ooi Teik Huat is a member of Malaysian Institute of Accountants and CPA Australia and 

holds a Bachelor of Economics degree from Monash University, Australia. He started his 

career with Messrs Hew & Co (now known as Messrs Mazars), Chartered Accountants, 

before joining Malaysian International Merchant Bankers Berhad (now known as MIMB 

Investment Bank Berhad). He subsequently joined Pengkalen Securities Sdn Bhd (now known 

as PM Securities Sdn Bhd) as Head of Corporate Finance, before leaving to set up Meridian 

Solutions Sdn Bhd where he is presently a director. 

Mr. Ooi Teik Huat is also a director of Tradewinds (M) Berhad, MMC Corporation Berhad, 

DRB-Hicom Berhad and Zelan Berhad. 

Mr. Ooi Teik Huat has attended all six (6) Board Meetings held during the financial year 

ended 31 December 2010. 

Encik Pakhruddin bin Sulaiman, aged 54, was appointed to the Board of Directors of 

Tradewinds Plantation Berhad on 6 March 2006. He is also a member of the Audit 

Committee and the Nomination and Remuneration Committee. 

Encik Pakhruddin bin Sulaiman holds a Bachelor of Laws (LL.B Honours) degree from the 

University of London in 1982 and qualified as a Barrister-at-Law (Lincoln’s Inn), United 

Kingdom. Upon being called to the Malaysian Bar in July 1985, he worked as a Legal 

Assistant at the following legal firms: Messrs A.J Ariffin, Chong & Harpal from 1985 to 

1987, Messrs Nik Saghir, Yaacob & Ismail from 1987 to 1991 and Messrs Abu Talib 

Shahrom, Khamil & Zahari from 1992 to 1993. From 1993 to 2005, Encik Pakhruddin bin 

Sulaiman was the Managing Partner of Messrs Mohd Khamil & Co. He is presently the 

Managing Partner of Messrs Pakhruddin & Partners, a legal firm in Selangor Darul Ehsan. 

He also sits on the Board of United Malayan Land Berhad and several private limited 

companies. 

Encik Pakhruddin bin Sulaiman has attended all six (6) Board Meetings held during the 

financial year ended 31 December 2010. 


PAKHRUDDIN BIN 

SULAIMAN 


Director 



23

24 


BOARD OF 

DIRECTORS 

BAKRY BIN HAMZAH 

Non-Independent 

Non-Executive Director 



Encik Bakry bin Hamzah, aged 53, was appointed to the Board of Directors of Tradewinds 

Plantation Berhad on 27 June 2006. He is also a member of the Executive Committee. 

Encik Bakry bin Hamzah graduated with Bachelor of Arts (Honours) from the University of 

Malaya. He was an Assistant Director of Marketing of Lembaga Padi dan Beras Negara 

(LPN) from 1981 to 1984 and had also served in various private limited companies. He was 

the Chief Executive Officer of Tradewinds (M) Berhad from 2005 to 2007 and Managing 

Director of Central Sugars Refinery Sdn. Bhd. He is currently the Managing Director of 

Padiberas Nasional Berhad and the Group Managing Director of Tradewinds (M) Berhad. 

Encik Bakry bin Hamzah had previously served on the Boards of various companies 

including Latitude Tree Holdings Berhad as an Executive Director from 1997 to 2001, 

Director of Oriental Food Industries Berhad from 2002 to 2003 and Director of MARDEC 

Berhad from 2003 to 2004. 

Encik Bakry bin Hamzah has attended all six (6) Board Meetings held during the financial 

year ended 31 December 2010. 

Mr Chuah Seong Tat @ Chuah Chee Tat, aged 60, was appointed to the Board of Directors 

of Tradewinds Plantation Berhad on 27 June 2006. He is also a member of the Audit 

Committee and Executive Committee. 

Mr Chuah Seong Tat holds a Bachelor of Applied Science (Honours) degree from Universiti 

Sains Malaysia and a Master of Business Administration from Australian Graduate School 

of Management, University of New South Wales. Mr Chuah Seong Tat began his career as 

an Engineer with American multinational semiconductor manufacturing companies located 

in Malacca and Penang from 1976 to 1980. 

He left his engineering career to pursue his Master of Business Administration degree in 

Australia from 1981 to 1982. Upon returning from Australia, he had worked and gained 

years of valuable experience in merchant banking, stock broking and trading. He had held 

various senior positions in those years. Presently, he is the Non-Independent Non-Executive 

Director of Tradewinds (M) Berhad and the Non-Independent Non-Executive Director of 

Padiberas Nasional Berhad. He is also a Director of Bukhary Sdn. Bhd., KHSB Marketing 

Sdn. Bhd. and Butterworth Coldstorage Sdn. Bhd. 

Mr Chuah Seong Tat has attended all six (6) Board Meetings held during the financial year 

ended 31 December 2010. 

CHUAH SEONG TAT @ 

CHUAH CHEE TAT 


Non-Executive Director

MOHD NAZRI 

BIN MD. SHARIFF 


Non-Executive Director 

CHIEF EXECUTIVE OFFICER 

Encik Mohd Nazri bin Md. Shariff is 45 years old and has been a Director of the Company 

since April 2009. He is a member of the Malaysian Institute of Accountants and a Fellow of 

the Association of Chartered Certified Accountants, UK. 

While in the United Kingdom, he trained as a Chartered Certified Accountant with 

Messrs Clarke Walker Chartered Accountants. On his return to Malaysia, he accumulated 

experience in auditing, banking, as well as corporate and financial management while 

serving in the credit risk, internal audit and corporate banking divisions of Amanah Capital 

Group of Companies and the Bank of Commerce. 

Prior to his current appointment as the Group Chief Financial Officer of Tradewinds (M) 

Berhad, he was the General Manager (Finance and Corporate) of various subsidiaries 

within the MMC Berhad Group. He was also the Group Chief Operating Officer of Pernas 

International Holding Berhad, Group Chief Financial Officer of Padiberas National Berhad 

and Group Chief Executive Officer of Tradewinds (M) Berhad. 

He currently oversees the financial management of Tradewinds (M) Berhad Group of 

Companies. 

He has attended all of the six (6) Board Meeting held during the financial year ended 

31 December 2010. 

Mr Chan Seng Fatt, aged 47, a Chartered Accountant of the Malaysian Institute of 

Accountants, joined Tradewinds Group in 2003 as the Chief Financial Officer of Tradewinds 

(M) Berhad and later posted to Tradewinds Plantation Berhad as the Acting Chief Executive 

Officer and Chief Financial Officer on 1 September 2006. He holds his current position as 

Chief Executive Officer of Tradewinds Plantation Berhad since 23 October 2007. 

Prior to joining Tradewinds Group, Mr Chan Seng Fatt has held several senior positions in 

various private and public companies. He joined Multi-Purpose Holdings Berhad in 1988 as 

the Internal Auditor for three years before serving Asian Pac Holdings Berhad from 1991 to 

1993 as the Group Accountant. From 1993 to 1997 he was the Financial Controller for 

Pengkalen Securities Sdn Bhd and later appointed as the General Manager of Halim Securities 

Sdn Bhd in 1997 before joining K&N Kenanga Berhad in 1999 as a Remisier. Mr Chan Seng 

Fatt was the Chief Financial Officer for Johore Tenggara Oil Palm Berhad from 2001 to 2002. 

He does not have any interest in the securities of the Company or its subsidiaries. 

The Directors and the Chief Executive Officer are Malaysians. None of them have family relationship with other Directors and/ 

or major shareholders of Tradewinds Plantation Berhad and have no conflict of interest with Tradewinds Plantation Berhad. They 

have not been convicted of any offences within the past ten (10) years other than traffic offences, if any. 


CHAN SENG FATT 




25

26 



Annual Report 2010

MANAGEMENT 

TEAM 

CORPORATE DIVISION 

(Left to right) 

Chan Seng Fatt 


Razidan bin Ghazalli 

Chief Financial Officer 

Khoo Pao Yin 

Senior General Manager, Finance 

Zil Huda binti Mohd Nor 

General Manager, Corporate Planning 

Zainudin bin Mohd Yatim 

General Manager 

Human Resource and Administration 

Zainal Rashid bin Ab Rahman 

General Manager, Secretarial & Legal 

Loh Meng Chee 

General Manager, Information Technology 

Amir bin Ismail 

Assistant General Manager, Purchasing 

Lee Wai Ming 

Manager, Marketing 




27

28 


MANAGEMENT 

TEAM 

ADVISORY & SUPPORT 




Asmal bin Abd Hadi 

Group Planting Advisor 

Choong Siew Ming 

Group Mill Engineering Advisor 

Muhammad Pilus bin Zambri 

Research & Development Controller 

Johari bin Mohd Yusof 

General Manager, Engineering (Civil) 

Abdul Aziz bin Ismail 

Deputy General Manager 

Business Strategic/Total Quality Environmental 

Management 

Abdullah bin Daud 

Assistant General Manager 

Special Development Project & Land Matters

PLANTATION DIVISION 


Paimin bin Selamat 

Director of Plantation 

Mohd Anim bin Abdul Rahman 

Regional Senior General Manager 

Semenanjung Operations 

Rahmat bin Karto 

General Manager, Kedah Project 

Shaharuddin bin Md Rashid 

Regional General Manager 

Mukah Region 

Shahrir bin Abd Aziz 


Miri Region 

Karuppiah s/o Subramaniom 


Northern Peninsular Region 

Yong Swee Lai 


Sibu Region 

Mohd Izwan Wasandan bin Abdullah 


Sabah/Lawas Region 

Saidi bin Bujang 

Regional Assistant General Manager 

Kuching Region 




29

30 


GROUP CORPORATE 

STRUCTURE 

–– • 100% TRADEWINDS PLANTATION MANAGEMENT SDN BHD 

–– • 100% TRADEWINDS AGRO SERVICES SDN BHD 

–– • 100% TRADEWINDS PLANTECH SDN BHD 

–– • 100% TRADEWINDS PLANTATION SERVICES SDN BHD 

–– • 100% TRADEWINDS PLANTATION CAPITAL SDN BHD 

–– • 100% TRADEWINDS CORRIDOR SDN BHD 

–– • 100% QUEK SHIN & SONS PTE LTD 

–– • 100% TEON CHOON REALTY COMPANY SDN BHD 

–– • 100% LADANG CHENDANA SDN BHD 

–– • 100% IBOK PLANTATION SDN BHD 

–– • 100% BINU PLANTATIONS SDN BHD 

• Cultivation of oil palm and production of crude palm oil 

• Cultivation of oil palm 

• Plantation management and advisory services 

• Sole and specific purpose of undertaking Islamic Securities Transactions 

• Investment holding company 



–– • 100% LADANG PERMAI SDN BHD 

–– • 100% LADANG SERASA SDN BERHAD 

–– • 100% LADANG MAWAR SDN BHD 

–– • 100% SYARIKAT LADANG SAWIT CHERUL SDN BHD 

–– • 100% PRISMA SPEKTRA SDN BHD 

–– • 70% KUMPULAN KRIS JATI SDN BHD 

–– • 70% BAHTERA BAHAGIA SDN BHD 

–– • 70% BARISAN TEKAD SDN BHD 

–– • 70% NORTHERN INTERGRATED AGRICULTURE SDN BHD 

–– • 100% NIA DEVELOPMENT SDN BHD 

–– • 100% NIA INFRASTRUCTURE SDN BHD 

–– • 50% PRIDE PALM OIL MILL SDN BHD 

–– • 100% SOLAR GREEN SDN BHD 

• Cultivation of oil palm and rubber trees 

• Ceased operation 

• Dormant 

• Property Development and rubber plantation

–– • 100% JOHORE TENGGARA OIL PALM BERHAD 

–– • 100% LADANG PETRI TENGGARA SDN BHD 

–– • 100% PERTANIAN JOHOR TENGGARA SDN BHD 

–– • 100% AGROMAJU SENDIRIAN BERHAD 

–– • 100% PERMODALAN PELANGI SDN BHD 

–– • 100% TANAH SEMAI SDN BHD 

–– • 100% SEMAI SEGAR SDN BHD 

–– • 100% UNI-AGRO PLANTATIONS (TRENGGANU) SDN BHD 

–– • 100% M.P. PLANTATION SDN BHD 

–– • 70% LADANG SUNGAI RELAI SDN BHD 

–– • 100% AGROMAJU LANDSCAPE SDN BHD 

–– • 100% HAK JTOP SDN BHD 

–– • 51% BARISAN PERANGSANG SDN BHD 

–– • 100% AMALAN PENAGA (M) SDN BHD 

–– • 85% TRANS KENYALANG SDN BHD 

–– • 85% SENANDUNG MASYHUR SDN BHD 

–– • 70% TRADEWINDS TANJUNG ALAN PLANTATION SDN BHD 

–– • 70% ARAH BERSAMA SDN BHD 


–– • 70% USAHA WAWASAN SDN BHD 

–– • 70% MELUR GEMILANG SDN BHD 

–– • 60% AMALAN PELITA PASAI SDN BHD 



31

STRATEGIC 

DIVERSIFICATIONS 

Through our diversification into rubber plantation, we are poised to 

gain from new areas of immense opportunities whilst we embark on 

initiatives in building an integrated rubber trade township and realize 

our expansionary plans into downstream rubber activities.

PERFORMANCE 

REVIEW

36 

PERFORMANCE REVIEW 

CHAIRMAN’S 

STATEMENT 

DEAR SHAREHOLDERS, 

TRADEWINDS PLANTATION BERHAD (“TPB” OR THE “GROuP”) 

CAN LOOk BACk ON THE yEAR uNDER REvIEW (“Fy 2010”) 

WITH A SENSE OF SATISFACTION AND ACCOMPLISHMENT. 

IN SPITE OF THE DECLINE IN THE PRODuCTION OF CRuDE 

PALM OIL IN MALAySIA IN 2010, THE GROuP WAS ABLE TO 

OvERCOME THE CHALLENGES TO POST RECORD EARNINGS 

GROWTH AND PROFITABILITy. 

Revenue rose by 34.2% to RM909.1 

million from RM677.4 million registered 

in 2009. Profit before tax rose 3-fold to 

RM282.4 million from RM78.3 million 

in 2009. Significant gains were also 

made on other fronts, notably in 

operational efficiencies and resource 

allocation. On the strength of these 

results, FY 2010 was a watershed year 

for the Group, heralding our emergence 

as one of the main players in the 

country’s plantation sector. 



Through all our efforts, a solid 

foundation has been established for the 

Group to ‘Forge Ahead and Achieve 

Strategic Growth’. In striving towards 

our ultimate objective of increasing 

shareholder value, we will ensure that 

all our operations are economically, 

socially and environmentally sustainable 

in conformity with the 3Ps-bottomline, 

namely Profits, People and the Planet. 

For a relatively young entity, TPB has 

made major strides forward since its 

listing on the Main Board of Bursa 

Malaysia on 15 March 2006. However, 

I firmly believe that TPB remains an 

unfolding story with many more pages 

and chapters to be filled. From our new 

position of strength and guided by a 

clear vision of where we should be 

heading and a road-map that will take us 

there, we stand at the threshold of a new 

phase of dynamic growth with exciting 

possibilities and prospects. I invite you to 

continue journeying with us to unlock the 

Group’s significant potential. 

On behalf of the Board of Directors, it is 

my honour to present this annual report 

and financial statements of the Company 

and Group for the financial year ended 

31 December 2010.

Dato’ Wira Syed Abdul Jabbar 

bin Syed Hassan 

Chairman 




37

38 


CHAIRMAN’S 

STATEMENT 

INDUSTRY OVERVIEW 

The Malaysian Palm Oil Board in its 

overview of the domestic industry 

reported that crude palm oil (“CPO”) 

production declined by 3.3% to 16.99 

million tonnes in 2010 from 17.56 

million tonnes recorded the previous 

year. This was attributed mainly to 

adverse climatic conditions caused by 



the El Nino and La Nina phenomena. 

The hot and dry conditions caused by El 

Nino in the first half of the year and 

excessive rainfall in the second half due 

to La Nina impacted on the yield of 

fresh fruit bunches (“FFB”), contributing 

towards lower CPO production. The 

resulting floods in certain areas towards 

year-end also affected harvesting 

activities.

Notwithstanding the lower production, 

the palm oil industry benefited from 

higher prices in 2010 supported by 

sentiments related to tight supply of 

vegetable oils in the world market, low 

domestic palm oil stocks and firmer 

crude oil prices. The average CPO 

price in 2010 rose by 20.8% to 

R M 2 , 7 0 1 . 0 0 p e r t o n n e f r o m 

RM2,236.50 achieved in the previous 

year. The highest monthly average CPO 

price was attained in December at 

RM3,620.00, while the lowest was 

recorded in July at RM2,453.00. In line 

with the increase in CPO prices, the 

average price of palm kernel during the 

year under review rose sharply by 

62.2% to RM1,735.50 per tonne. 

Exports of palm oil increased by 4.9% 

to 16.66 million tonnes from 15.88 

million tonnes recorded in 2009. China 

remained the country’s biggest export 

market, with an off-take of 20.9% of 

total palm oil exports. Other main 

markets included Pakistan (12.8%), the 

European Union (12.4%), India (7.0%), 

United States of America (6.2%), Egypt 

(5.6%) and Japan (3.3%). 

FINANCIAL PERFORMANCE 

For the year ended 31 December 2010, 

revenue was posted at RM909.1 million, 

which is the highest recorded by the 

Group. This represents a 34.2% 

increase from RM677.4 million recorded 

in the previous year. The Group also 

achieved a 260.7% increase in profit 

before tax to RM282.4 million, against 

the RM78.3 million posted in 2009. The 

improved bottom-line results were mainly 

attributable to higher prices of palm 

products during the year. On the strength 

of these financial numbers, earnings per 

share has improved significantly to 

29.63 sen. 

The Group’s improved financial numbers 

were reflected by its strong showing on 

Bursa Malaysia, and this has caught the 

attention of many analysts and research 

houses. Some analysts recognise the 

Company as a potential growth stock, 

singling out the Group’s favourable 

maturity profile of its plantation crop, 

new planting programme and earnings 

potential. Our counter has been on the 

uptrend throughout 2010, closing the 

year at RM3.39. 

DIVIDENDS 


A first interim dividend of 5 sen per 

ordinary share less income tax of 

2 5 % (2009:Nil) amounting to 

RM19,843,254 (2009:Nil) for the 

financial year ended 31 December 

2010 was paid to the shareholders on 

30 December 2010. 

On the back of the commendable 

results, the Board of Directors is pleased 

to propose a final dividend of 5 sen per 

share less income tax of 25% (2009:6 

sen per share less income tax of 25%) 

amounting to RM19,843,254 (2009: 

RM23,811,904) for the financial year 

ended 31 December 2010. Subject to 

the approval of shareholders at the 

forthcoming Annual General Meeting, 

this will be payable on 28 July 2011. 

Pending approval of shareholders, the 

total dividend pay-out for the FY 2010 

would amount to RM39,686,508 

compared to RM23,811,904 in the 

previous financial year. 



39

40 


CHAIRMAN’S 

STATEMENT 

CORPORATE DEVELOPMENTS 

As reported last year, Prisma Spektra 

Sdn. Bhd., a wholly-owned subsidiary 

of TPB, entered into a conditional Share 

Sale Agreement with Semi Bayu Sdn. 

Bhd. on 30 October 2009 to purchase 

the entire issued and paid-up ordinary 

share capital of MARDEC Berhad 

(“Mardec”). Mardec is an investment 

holding company and through its local 

and overseas subsidiaries and 

associates, is involved in the processing 

and trading of natural rubber and the 

manufacturing of value-added rubber 

and polymer products. 

The proposed acquisition of Mardec is 

conditional upon the fulfilment of various 

conditions of which we are awaiting 

for the approval of the respective 

authorities. 



A BLUE-PRINT FOR SUCCESS 

We have set our sights on being the 

‘preferred globally competitive 

integrated agri-business organisation 

that delivers outstanding value to all’, a 

goal that is enshrined in our Group’s 

Corporate Vision. Our journey towards 

achieving this lofty goal began by 

taking a holistic and comprehensive 

view of our standing in the industry. By 

critically evaluating our strengths and 

weaknesses, a blue-print for success 

was carefully crafted, which among 

others, identified strategic growth areas 

as well as the means and a time-frame 

to achieve specific corporate goals and 

objectives. 

The Group’s road-map to success rests 

on the following major strategies: 

• Organic growth 

• Strategic acquisitions 

• Diversification and broadening the 

revenue base in the plantationrelated 

industries 

• Leveraging on our human capital 

One of the Group’s greatest strengths 

lies in its sizeable landbank of 141,465 

hectares. Of this total, some 67.3% have 

been planted with oil palms and rubber 

trees and another 8.6% are under 

development. The remaining 24,491 

hectares of plantable reserves will be 

gradually developed to support organic 

growth for the next four years or so.

Meanwhile, we remain alert to the 

windows of opportunity coming our 

way to expand our landbank reserves 

through strategic acquisitions. As 

previously reported, in October 2009, 

the Group acquired a 70% stake in 

Northern Intergrated Agriculture Sdn. 

Bhd. (“NIA”), adding 2,612.99 acres 

(the “NIA Land”) of landbank to its 

reser ves. The NIA Land is also 

strategically located within the vicinity 

of the Group’s existing 11,404 hectares 

of plantation land in Padang Terap, 

Kedah acquired in March 2008. The 

subsequent development of 5,670 

hectares for rubber planting has given 

the Group the distinction of owning one 

of the largest commercially operated 

rubber plantations in the country within 

a single location. 

The Group started out with oil palm as a 

single plantation crop. This monoculture 

planting strategy exposes the Group to 

inherent risks, not only from the 

environmental but also economic 

perspectives. Even though the prices of 

palm products have been generally 

favourable, a conscious decision was 

taken as early as in 2007 to diversify 

the Group’s earnings base to mitigate 

any volatility and adverse changes in 

the palm oil industry. Our diversification 

strategy would also expand the Group’s 

earnings base by providing an 

additional source of recurring revenue. 

A brilliant blue-print for success would 

come to nothing if it were not for the 

people resources to translate it into 

reality. In this regard, the Group has an 

exceptional pool of human capital. 

Drawn from diverse disciplines, our 

people are young, knowledgeable and 

highly motivated and have demonstrated 

the entrepreneurial flair to translate a 

plan into concrete results. By leveraging 

on what we consider to be one of our 

greatest assets, our people have 

propelled the Group forward to where 

it stands today – recognised by peers 

and competitors alike as a major player 

in the industry. 



Under the Group’s Development 

Programme for 2011; 6,018 hectares 

have been earmarked for development 

into oil palm plantations. This is 

consistent with the Group’s strategy to 

develop 5,000 to 6,000 hectares per 

annum and at this rate, the phased 

development of the remaining plantable 

reserves of some 18,000 hectares 

would be completed by the year 2014. 

N o n e t h e l e s s , t h e d e v e l o p m e n t 

programme will be reviewed from time 

to time, taking into consideration the 

market dynamics, resources and cash 

flow of the Group. 

The coming year will see the Group 

pressing ahead with its replanting 

programme, whereby trees over the 

age of 25 years with declining FFB 

yields are replanted. Under this 

programme, 1,286 hectares of oil 

palms in Johor and Sabah will be 

replanted. The Group’s development 

and replanting programmes are closely 

inter-twined and are designed as far as 

possible to achieve an optimum age 

profile. 



41

42 


CHAIRMAN’S 

STATEMENT 

While the latest financial results attest to 

the Group’s solid fundamentals, we will 

continue to practice financial prudence, 

incurring capital expenditure on a ‘need 

basis’. We will keep a close watch on 

managing our spending, the priority 

being on programmes to enhance 

p r o d u c t i v i t y a n d o p e r a t i o n a l 

efficiencies. At the same time, a raft of 

measures and strategies will be rolled 

out to enhance on the existing cost 

control measures. Among others, these 

include the adoption of labour-reducing 

technologies, mechanisation of field 

operations and widening the coverage 

of centralised purchasing functions to 

lower input costs. 

For 2011, closer attention will be given 

to yield enhancement. Apart from 

improved agronomic management 

practices, we will also embark on 

utilising high-yielding elite planting 

materials through the tissue culture 

programme. 

Efforts will also be channelled to further 

improve efficiency in our mills 

operations. The focus will be on 

achieving an improved utilisation rate 

vis-à-vis a higher throughput of quality 

third-par ty crops. We are also 

strengthening operational management 

via the regionalisation of mill advisory 

functions and the establishment of a mill 

engineering committee. 



At the current rate of FFB production, 

the Group’s mills are already nearing 

full capacity. Plans are in the pipeline to 

construct three additional mills in stages, 

with the first set to take off sometime in 

2011 with the state-of-the-art milling 

technology which will have a capacity 

of 40 tonnes per hour and will be 

located in Kuala Suai, Miri, Sarawak. 

OUTLOOK AND PROSPECTS 

Financial Year 2011 is already shaping 

up to be a promising one. Global 

supply of vegetable oils remains tight 

while the prospects of a shortage of 

rubber continue to hang over the world. 

Due to growing unrest in the Middle 

East, crude oil prices have already 

surged past the US$100 per barrel and 

positively impacting commodity prices, 

including those of palm oil and rubber. 

In the first quarter of 2011, CPO prices 

were already trading above the industry 

expectations of RM3,000 per tonne 

compared to an average of RM2,701 

per tonne achieved in 2010. With 

higher crude oil prices, many countries 

will also be encouraged to turn to palm 

oil as a feedstock for the manufacture of 

bio-fuels. Meanwhile, global rubber 

prices had already rallied to fresh 

historical highs in 2010. Supported by 

healthy demand by the tyre and other 

rubber-based industries and strong 

imports from countries like China, the 

price of rubber is expected to continue 

its upward trajectory in 2011. 

The Group is well positioned to meet the 

global demand for palm oil, with 49% 

of our planted area currently at its 

prime. Meanwhile, rubber is set to 

contribute positively to Group’s revenue 

when our subsidiary, Tradewinds 

Corridor Sdn. Bhd.’s rubber plantation 

reaches maturity in subsequent years. 

While we have enough land in reserves 

to support our development plans for 

the next four years or so, we will 

continue to explore opportunities to 

expand our landbank. 

Moving forward, we are exploring for 

the right opportunities to move further 

down the value chain by investing into 

the downstream businesses to further 

enhance the long-term shareholders 

value. As we progress, downstream 

expansion will enable us to achieve the 

goal of vertical integration across the 

entire spectrum of our palm oil business, 

which is in line with the Company’s 

vision to be an integrated agri-business 

organisation. If the proposed acquisition 

of Mardec is approved, this will also 

provide a strategic fit to our plans to 

move further downstream in the rubber 

sector. Mardec has a proven track 

record in the processing and trading of 

natural rubber and the manufacturing of 

value-added rubber and polymer 

products.

ACKNOWLEDGEMENTS 

T h e G r o u p ’ s s u c c e s s a n d 

accomplishments within the past year 

were made possible by management 

and staff working closely together. As a 

cohesive team, our people represent a 

formidable force that embodies Group 

core values – Integrity, Accountability, 

I n n o v a t i v e , K n o w l e d g e a b l e , 

Enterprising, Caring. These attributes 

are the Group’s bedrock elements of 

success that will ensure the Group 

achieving its ultimate vision. 

We also owe our success to the 

understanding and support received 

from all stakeholders, notably our 

business associates, customers, 

financiers, various government agencies 

and especially our shareholders. 

Last but not least, to my fellow members 

of the Board thank you for your support, 

advice and wise counselling to steer the 

Group to greater heights. 

Forging ahead, we will need the support 

of all of you in the spirit of common 

enterprise and determination as we 

strive to bring the Group to new levels 

of achievement. 

Thank you. 


bin Syed Hassan 

Chairman 




43

44 


BuSINESS 

REvIEW 

By CHIEF EXECuTIvE OFFICER 

FINANCIAL YEAR 2010 (“FY 2010”) WAS GENERALLY CHALLENGING IN TERMS OF THE 

OPERATING ENVIRONMENT WITH UNPREDICTABLE ADVERSE WEATHER CONDITIONS 

AND A TIGHT LABOUR MARKET. WHILE THE COMPANY HAS NO CONTROL OVER THE 

FORCES OF NATURE, WHICH HAD MARGINALLY AFFECTED FRESH FRUIT BUNCHES (“FFB”) 

PRODUCTION, THIS WAS MITIGATED BY AN IMPROVED OIL ExTRACTION RATE (“OER”) FOR 

CRUDE PALM OIL (“CPO”) ACHIEVED BY THE GROUP’S EIGHT PALM OIL MILLS. THE GROUP 

WAS FORTUNATE THAT IT WAS RELATIVELY WELL PREPARED TO FACE WITH THE PROBLEMS 

ASSOCIATED WITH LABOUR SHORTAGES PREVALENT THROUGHOUT THE INDUSTRY. 

OPERATIONAL HIGHLIGHTS 

The Group was not spared the adverse 

effects of the El Nino and La Nina 

phenomena that impacted on FFB 

production nationwide. Apart from the 

marginal decline in FFB production, I 

am pleased to report that the Group has 

been able to meet, if not exceed, key 

operational targets set for FY 2010. The 

operational highlights of the year are 

summarised as follows: 



• The Group successfully achieved 

its development and re-planting 

programme as targeted in line 

with the development programme 

for FY 2010. 

• Headway was also made in the 

rubber diversification programme, 

with an increase in rubber planted 

area. 

• The Sg. Kachur Palm Oil Mill and 

Ulu Sebol Palm Oil Mill earned 

certification to ISO 9001:2008. 

• The Group’s extraction rates for 

CPO and palm kernel (“PK”) 

improved to 21.54% and 5.35% 

respectively, the highest achieved 

to date. 

• In striving for sustainability, major 

strides were made in the key 

areas of Occupational Safety and 

Health (“OSH”), environmental 

management, corporate social 

responsibility and the adoption of 

the best agricultural practices.






45

BuSINESS REvIEW 


• The Group achieved a much 

improved safety performance in 

FY 2010, and this was reflected in 

the lower number of accident 

cases, number of work-days lost 

and fatal cases reported. 

• The Group continued to expand 

the breadth and depth of its talent 

pool through ongoing recruitment, 

training and human resource 

development efforts. 

Progress was also made in the Group’s 

bid to gain Roundtable Sustainable 

Palm Oil (“RSPO”) Certification. 

Landbank 

The Group has a landbank of 141,465 

hectares, of which 77,124 hectares or 

54.5% are located in Sarawak, another 

11,302 hectares or 8.0% are in Sabah, 

20,940 Ha 

23% 

46 


18,326 Ha 

20% 

796 Ha 

1% 

6,265 Ha 

7% 

Immature 1 – 3 years 

Young 4 – 8 years 

Prime 9 – 18 years 

Past prime 19 – 25 years 

Due for replanting > 25 years 

44,779 Ha 

49% 



while the remaining 53,039 hectares or 

37.5% are in Peninsular Malaysia. 

Some 95,270 hectares or 67.3% have 

been developed into oil palm and 

rubber estates, with another 12,235 

hectares or 8.6% under development. 

As at year end, the Group’s total 

remaining plantable reserves stood at 

24,491 hectares, which will be 

developed over the next four years. 

Maturity Profile 

Some 44,779 hectares or 49% of our 

oil palm plantations consist of trees at 

the prime age of between 9 and 18 

years. Another 20,940 hectares (23%) 

comprise immature trees of 1 to 3 years, 

while young trees between 4 and 8 

years make up 18,326 hectares (20%). 

The remaining hectarage consist of 

trees that are past their prime or due for 

replanting. 

The Group also has 579 hectares of 

mature rubber plantations. Since 2008, 

concerted efforts have been made to 

pursue our crop diversification 

programme, and as a result, we now 

have 4,164 hectares of plantations 

planted with rubber trees. 

Production 

OIL PALM HECTARAGE BY PALM AGE PRODUCTION OF PALM PRODUCTS (tonnes) 

46,074 

186,744 

2006# 

978,759 

57,105 

219,349 

2007 

1,160,994 

60,786 

For the industry as a whole, the adverse 

weather conditions and flooding in 

certain areas had affected the national 

average FFB yield, which in turn 

contributed to a lower CPO production. 

Peninsular Malaysia was the most 

severely affected, with average FFB 

yields declining by 7.5%, followed by 

Sabah and Sarawak of 4.7% and 2.6% 

respectively. 

238,893 

2008 

1,197,026 

62,743 

250,406 

2009 

1,196,876 

62,283 

250,726 

2010 

Palm kernel (PK) Crude palm oil (CPO) Fresh fruit bunches (FFB) 


1,191,685

Following the national trend, the 

Group’s production of FFB in 2010 

declined marginally to 1,191,685 

tonnes from 1,196,876 tonnes recorded 

in 2009. However, we achieved a 

higher yield per hectare of 16.92 

tonnes during the year under review, 

which is an improvement over 16.87 

tonnes achieved in 2009. 

Despite the lower FFB production, 

production of CPO increased to 

250,726 tonnes from 250,406 tonnes 

recorded in 2009. However, production 

of palm kernel declined marginally to 

62,283 tonnes from the previous year’s 

62,743 tonnes. 

Milling Operations 

Strategically located throughout the 

country, the Group’s eight mills have a 

total combined capacity of 1,260,000 

tonnes for processing FFB harvested 

from the Group’s own plantations as 

well as third-party crops. Throughout the 

years, continuous efforts have been put 

HECTARAGE AS AT 31 DECEMBER 2010 

PLANTED UNDER DEVELOPMENT 

into all our mills to improve the 

respective mills’ operational efficiency 

and productivity. Many quality initiatives 

and programmes that have been put in 

place were spear-headed by the 

Group’s Mill Engineering Unit and Total 

Quality Environmental Management 

Strategic Business Unit (“TQEM–SBU”) 

together with the respective Joint 

Consultative Committees. 

Resulting from these efforts the Group’s 

OER improved from 21.20% to 21.54% 

in 2010, which compares favourably 

with the national OER rate of 20.45%. 

The extraction rate for palm kernel also 

improved to 5.35% from 5.31% 

achieved in the previous year. 

RESEARCH AND DEVELOPMENT 

Research and Development (“R&D”) has 

contributed in no small measure to 

Malaysia’s leadership position in the 

g l o b a l p a l m o i l i n d u s t r y. T h e 

Government is encouraging greater 


Oil Palm Oil Palm Rubber Rubber Oil Palm Rubber PLANTABLE OTHERS TOTAL 

Matured Immature Matured Immature RESERVES 

Sarawak 33,607 13,399 – – 6,549 – 19,626 3,943 77,124 

Sabah 8,948 602 – – 827 – – 925 11,302 

Peninsular Malaysia 27,611 6,939 579 3,585 3,533 1,326 4,865 4,601 53,039 

Total 70,166 20,940 579 3,585 10,909 1,326 24,491 9,469 141,465 

private sector contribution to the R&D 

effort to complement the activities of 

government agencies such as the 

Malaysian Palm Oil Board (“MPOB”) 

and Palm Oil Research Institute of 

Malaysia (“PORIM”). 

Our investment in R&D is part of the 

Group’s strategy to be a key player in 

the oil palm industry. The R&D Centre 

that was set up some years ago has a 

dedicated pool of researchers and 

agronomists. The Group has also 

e s t a b l i s h e d a R e s e a r c h a n d 

Development Advisory Committee 

whose major function is to identify R&D 

areas that could be beneficial to the 

Group’s operations, which include 

seeking breakthroughs in agronomics, 

p e s t a n d d i s e a s e c o n t r o l a n d 

mechanisation of field operations. 



47

48 




The R&D Centre has collaborated with 

other research units such as MPOB and 

Universiti Putra Malaysia (“UPM”) to 

improve agronomic management. 

Specific projects include a collaborative 

effort with MPOB to determine suitable 

protocols for the establishment of 

leguminous cover crops in peat soils 

and a joint-research project with UPM 

to look into phosphate requirements for 

peat planting. The Centre is also 

researching into methods of controlling 

the increasing threat of bunch moths 

through chemical, agronomical and 

biological means. Among the new 

projects the Centre is exploring is the 

Oil Palm Tissue Culture Programme as 

part of the Group’s long-term yield 

enhancement strategy. 

TOTAL QUALITY MANAGEMENT 

As the business environment becomes 

ever more competitive, the quality of 

our products and services can make the 

difference in penetrating new markets. 

To this end, the Group has extended its 

ISO certification programme for two 

more mills during the year. Having 

completed a rigorous process of 

awareness training, documentation and 

two audits by SIRIM QAS Int., the Sg. 

Kachur Palm Oil Mill and the Ulu Sebol 

Palm Oil Mill earned their certification 

to ISO 9001:2008 on 16 July and 6 

September 2010 respectively. 



Complementing the ISO certification 

programme, the Group’s in-house 

TQEM-SBU began implementing quality 

audits during the year under review. 

The main objective of these audits is to 

ensure that basic policy guidelines are 

adhered to in the Group’s operating 

units. Any non-conformity or areas for 

improvement can be identified through 

these audits and redressed. 

WALKING THE GREEN PATH 

In a world increasingly concerned 

about environmental preservation, 

almost every major corporation attempts 

to walk the green path these days. Even 

before going green became a buzzw 

o r d , t h e G r o u p h a s t a k e n 

environmental stewardship in its stride 

as an integral part of ensuring 

sustainability in its operations. For 

years, the Group has walked the extra 

miles to adhere by the principles of 

sustainable agriculture practices that 

embrace an array of areas including 

integrated pest management, nutrient 

balancing, FFB evacuation, waste 

recycling, and fragile soils management 

among others. While technology plays 

an important role in meeting the 

sustainability objective, we have left no 

stone un-turned. We have also resorted 

to environmentally-friendly solutions 

such as the use of buffaloes in FFB 

evacuation or by encouraging owls to 

breed on our plantations as a means of 

rodent control. 

Positive steps have also been taken to 

complement national efforts in tackling 

major issues like green house gas 

emissions and water pollution. Our 

recent initiatives include the installation 

of a Continuous Emission Monitoring 

System at all our mills during the year 

under review. This move conforms with 

the requirement of the Environmental 

Quality (Clean Air) Regulations 1978, 

which requires the monitoring of boiler 

smoke emissions.

We have also embarked on a series of 

Palm Oil Mill Effluent (“POME”) 

treatment projects. In 2009, we initiated 

the construction of a tertiary treatment 

plant at Retus Palm Oil Mill, a mill that 

belongs to Retus Plantation Sdn. Bhd., a 

related company, and managed by 

TPB. Completed and commissioned in 

the fourth quarter of 2010, the treatment 

plant is capable of reducing the 

Biochemical Oxygen Demand and Total 

Suspended Solid levels of the mill’s final 

discharge to meet the standards set by 

the Department of Environment in 

Sarawak. A similar project is being 

implemented at Trusan Palm Oil Mill 

and is targeted for completion by the 

end of 2011. 

To reduce green house gas emissions, 

the Group is evaluating various 

proposals on methane capture, with the 

objective of utilising the captured gas for 

energy generation. Methane is one of 

the major green house gases produced 

in the anaerobic treatment of POME. 

During the year, the Group moved a 

step closer towards RSPO certification. 

One of the key requirements of the 

RSPO Principles and Criteria is open 

and transparent communication and 

consultation with the key stakeholders. 

Accordingly, a meeting with the 

representative stakeholders of the 

Tenggara Team was held on 11 

November 2010. Stakeholders who 

attended the meeting, included 

representatives from the Government, 

National Union of Plantation Workers 

and members of the surrounding 

community, have given encouraging 

endorsement to the Group. 

Going green is not a passing trend; we 

believe that the preservation of the 

environment is one of the biggest 

challenges of our time. TPB is committed 

to play its part as a responsible 

corporate citizen. 


No report to shareholders would be 

complete without some mention of our 

efforts in the important areas of 

corporate social responsibility, human 

resource management and occupational 

safety and health, which are covered in 

greater detail in a separate section of 

this report. We believe in integrating 

socially responsible policies, practices 

and programmes in all our decisionmaking 

processes and business 

operations based on ethical values and 

respect for the community, employees, 

the environment and our various 

stakeholders. Based on this philosophy, 

we will continue to channel resources 

and efforts to improve our standing in 

these key areas. By doing so, we 

provide the Group with a sustainable 

base for future earnings and operations. 



49

50 




RIDING THE MOMENTUM 

The Group stands at the threshold of a 

new dynamism. Post the 2006 listing of 

the Company, the major accomplishments 

of the Group include: 

• In financial year 2010, Group 

revenue has almost tripled to 

RM909.1 million from RM361.1 

million registered in 2006. 

• During the same period, profit 

before tax rose to RM282.4 

million, a 20-fold increase from 

RM14.1 million previously. 

• Earnings per share grew to 29.63 

sen from 3.49 sen in 2006. 

• The improvement in our financial 

performance is also reflected in 

the Company’s performance on 

Bursa Malaysia, which has risen 

from RM2.10 at year-end 2006 to 

close at RM3.39 at year-end 

2010. 



• Progressive increase in our 

landbank to 141,465 hectares 

through strategic acquisitions. 

• From a single crop plantation in 

2006, we have successfully 

diversified into rubber as the 

Group’s second plantation crop, 

with 4,164 hectares now planted 

with rubber. 

• Registered steady improvements in 

FFB yield, CPO production and 

extraction rates. 

All these demonstrate that we are a 

Group that is built on performance, 

achieving year-on-year improvements 

on both the financial and operational 

fronts. As we move forward, our 

fundamentals are strong and this is best 

reflected in the quality of our financial 

position. Even after factoring in capital 

expenditure incurred in recent strategic 

acquisitions, we have ensured that our 

gearing is kept at a very manageable 

level. The Group also has enough cash 

reser ves to finance any capital 

expenditure investments in the near 

future. 

The results we have achieved so far 

have propelled the Group into the ranks 

of one of the key players in the 

agriculture industry. It has also given 

our people a new-found confidence and 

they are now sharing their expertise in 

areas where the Group has unique 

knowledge and experience such as the 

development of oil palm plantations on 

peat, where TPB is one of the trailblazers. 

This was demonstrated last 

year when our staff presented papers at 

international conferences. Highlighting 

the Group’s experience in the “Best 

Agro-management Practices in Land 

Development”; “Rubber Cultivation: 

Issues and Challenges; Economics of 

Mechanisation – Estate Experiences”; 

and “Development of Oil Palm on Peat: 

A Socio-Economic Perspective”, - all 

three papers were well received by the 

international audience.

Our people must be considered among 

the Group’s greatest strengths. This is 

the same team that has taken the Group 

to where we are today. Riding on the 

momentum established, our people are 

all geared up and raring to go. 

The Group has come a long way but we 

have some distance yet to go to realise 

our full potential. I believe with the 

continued support and trust of our 

business associates, respective 

stakeholders and our Board of Directors, 

together with our team of committed 

colleagues, we will meet all set targets 

in due course. 






51

STRATEGIC 

EXPERTISE 

As our sights are firmly focused on achieving optimum 

results as well as striving to sustain our competitive edge and 

increase the asset value at the workplace, we comprehend 

that great emphasis must be placed to continuously enhance 

and equip our personnel with the necessary skills, improve 

competencies and strengthen all capabilities.

CORPORATE 

GOVERNANCE

56 

CORPORATE GOVERNANCE 

STATEMENT ON 


THE BOARD OF DIRECTORS (“THE BOARD”) ARE COMMITTED TO 

ACHIEVING AND DEMONSTRATING THE HIGHEST STANDARDS OF 

CORPORATE GOVERNANCE AND CONTINUE TO REVIEW THE 

FRAMEWORK AND PRACTICES TO ENSURE THEY MEET THE 

INTERESTS OF SHAREHOLDERS. 

THE BOARD IS PLEASED TO REPORT TO THE SHAREHOLDERS ON 

THE MANNER IN WHICH THE COMPANY HAS APPLIED THE 

PRINCIPLES OF GOOD CORPORATE GOVERNANCE THROUGHOUT 

THE FINANCIAL YEAR ENDED 31 DECEMBER 2010 AND THE EXTENT 

TO WHICH IT HAS COMPLIED WITH THE BEST PRACTICES SET OUT 

IN THE MALAYSIAN CODE ON CORPORATE GOVERNANCE (“THE 

CODE”) PURSUANT TO PARAGRAPH 15.25 OF THE MAIN MARKET 

LISTING REQUIREMENTS OF BURSA MALAYSIA SECURITIES BERHAD 

(“THE LISTING REQUIREMENTS”). 


Annual Report 2010

BOARD OF DIRECTORS 

A. BOARD COMPOSITION 

The Board has six (6) Directors comprising an Independent 

Non-Executive Chairman, two (2) Independent Non-Executive 

Directors and three (3) Non-Independent Non-Executive 

Directors. The Board has within it, professionals drawn from 

various backgrounds including finance, accounting, business 

management, legal, trading, manufacturing and commodity 

business bringing depth and diversity in experience, expertise 

and perspectives to the Group’s business operations. The 

Directors’ diversity of knowledge reflects the Company’s 

commitment to ensure the effective leadership and control of 

the Group. 

The profiles of the Directors are presented on pages 22 to 25 

of this Annual Report. 

The roles of the Independent Non-Executive Chairman and the 

Chief Executive Officer are separate with a clear distinction of 

responsibilities to ensure that there is a balance of power and 

authority. The Chairman is responsible for ensuring Board 

effectiveness and conduct whilst the Chief Executive Officer 

has overall responsibilities for the day to day management of 

the business and implementation of the Board policies and 

decisions. The Chief Executive Officer is responsible to duly 

ensure the execution of strategic goals, effective operation 

within the Group, and to update and inform the Board on 

matters pertaining to the Group. This division of responsibility 

between the Chairman and Chief Executive Officer ensures 

that accountability is given high priority. 

The Non-Executive Directors provide considerable depth of 

knowledge collectively gained from experiences in a variety 

of public and private companies as well as public service. The 

Independent Non-Executive Directors provide unbiased and 

independent views in ensuring that the strategies proposed by 

the management are fully deliberated and examined, in the 

interest of not only the Group but also of minority shareholders, 

employees and the business communities in which the Group 

conducts its business. 

The Board is satisfied that the current Board representation 

fairly reflects the investment interest of the shareholders in the 

Company. 

B. BOARD RESPONSIBILITIES 


The Board is responsible for the overall performance of the 

Group by: 

• Reviewing and adopting a strategic plan for the Group 

to ensure obligations to shareholders are met; 

• Overseeing the conduct of the Group’s business to ensure 

that the business is being properly managed; 

• Identifying principal risks and ensuring the implementation 

of appropriate systems to manage these risks through 

appropriate risk management and internal control 

procedures; 

• Succession planning including appointing, training, 

fixing the compensation of and, where appropriate, 

replacing senior management; 

• Developing and implementing an investor relations 

programme or shareholder communications policy for 

the Group; and 

• Reviewing the adequacy, effectiveness and integrity of 

the Group’s internal control system and management 

information systems including systems for compliance 

with applicable laws, regulations, rules, directives and 

guideline. 

The Board has a formal schedule of matters specifically 

reserved to it for decision to ensure that the direction and 

control of the Company is firmly in its hands. In addition, the 

Company has a framework on Policy and Authority Limits and 

Approval Process which defines the limits of authority for the 

Board, Executive Committee and Management as well as the 

guidelines on tender or purchasing procedures. 



57

58 


STATEMENT ON 


During the financial year the Board holds at least four (4) 

regular scheduled meetings annually with additional meetings 

for particular matters as and when necessary. Details of the 

attendance of Directors at the scheduled or additional board 

meetings are as follows: 

Directors No of Percentage 

Meetings % 

Attended 


bin Syed Hassan 6/6 100 

Ooi Teik Huat 6/6 100 

Pakhruddin bin Sulaiman 6/6 100 

Bakry bin Hamzah 6/6 100 

Chuah Seong Tat @ Chuah Chee Tat 6/6 100 

Mohd Nazri bin Md. Shariff 6/6 100 

All the Directors fulfilled the requirements of the Listing 

Requirements in respect of board meeting attendance. 

C. SUPPLY OF INFORMATION 

The Directors are provided with documents on matters 

requiring their consideration in a timely manner prior to the 

Board meetings. This is to ensure the Directors are able to 

obtain further explanations, where necessary, deliberate 

knowledgeably on issues and to enable the Directors to 

discharge their duties effectively and efficiently. The Board 

papers provide information on Group performance and major 

operational, financial and corporate issues. 



The Directors have access to the advice and services of the 

Company Secretary and senior management in carrying out 

their duties. The Directors may, whether as a full Board 

member or in their individual capacity obtain independent 

professional advice at the Group’s expense, where necessary 

and in appropriate circumstances, in furtherance of their 

duties. The Directors are also notified of any corporate 

announcements released to Bursa Malaysia Securities Berhad 

from time to time. 

D. APPOINTMENTS AND RE-ELECTIONS OF 

DIRECTORS 

The Company has instituted formal and transparent procedures 

for the appointment and re-election of Directors. The 

Nomination Committee is primarily responsible to propose, 

consider and recommend to the Board, candidates for 

directorships to be filled in the Board and Committees of the 

Board. The Nomination Committee also carries out annual 

assessments of the Board of Directors through comprehensive 

questionnaires and make recommendations for the reappointment 

and re-election of Directors at the Annual General 

Meeting. 

E. DIRECTORS’ TRAINING 

All members of the Board have attended and successfully 

completed the Mandatory Accreditation Programme (“MAP”). 

In compliance with paragraph 15.09 of the Listing 

Requirements, all Directors have attended at least one seminar 

or conference either organized internally or externally last 

year including the following:-

1. Dato’ Wira Syed Abdul Jabbar bin Syed Hassan 

• Audit Committee Institute Roundtable Discussion on 

Going Forward: Risk & Reform – Implications for 

Audit Committee Oversight held on 2 June 2010 

(KPMG) 

• Seminar on Corporate Governance and the Media 

held on 7 July 2010 (Bursatra Sdn Bhd) 

• The MPH Power-Packed Seminar - Investment 

Opportunities For 2010 And Beyond For Asian 

Companies And Investors held on 8 July 2010 (Jim 

Rogers) 

• Seminar on Recent Tax Cases & Developments held 

on 9 July 2010 (Lee Hishammuddin Allen & Gledhill) 

• Financial Institutions Directors’ Education 

Programme - Developing High Impact Boards - 

Module 2 held on 2 & 3 August 2010 (Bank 

Negara Malaysia & Perbadanan Insurans Deposit 

Malaysia) 



Module 3 held on 20 & 21 September 2010 (Bank 


Malaysia) 



Module 1 held on 4 & 5 October 2010 (Bank 


Malaysia) 



Module 4 held on 18 & 19 October 2010 (Bank 


Malaysia) 

2. Mr. Ooi Teik Huat 

• Forum on FRS 139 – Financial Instruments Standard 

held on 21 January 2010 (Bursa Malaysia) 






Rogers) 

• Seminar on Recent Tax Cases & Developments held 

on 9 July 2010 (Lee Hishammuddin Allen & Gledhill) 

• Seminar on Preventing Corporate Misdeeds: 

Principal Roles, Responsibilities and Accountabilities 

of Directors and Corporate Management held on 9 

December 2010 (Tradewinds (M) Berhad) 

3. Encik Pakhruddin bin Sulaiman 


• MICG Annual Directors Duties & Governance 

Conference – “Towards Boardroom Excellence and 

Corporate Governance Best Practices” held on 13 

& 14 January 2010 (Malaysian Institute of 

Corporate Governance) 

• Corporate Governance Week 2010 – Towards 

Corporate Governance Excellence held on 28 June 

to 2 July 2010 (Bursa Malaysia & Securities 

Commission) 









59

60 


STATEMENT ON 


4. Encik Bakry bin Hamzah 

• MICG Annual Directors Duties & Governance 

Conference – “Towards Boardroom Excellence and 

Corporate Governance Best Practices” held on 13 

& 14 January 2010 (Malaysian Institute of 

Corporate Governance) 






Rogers) 

• The 7th Superlative Annual Brand Marketing 

Conference 2010 held on 22 & 23 September 

2010 (Brandedge Sdn Bhd) 

• Leading Innovator Seminar held on 22 & 23 

September 2010 (Brandedge Sdn Bhd) 

• Strategic Agility Seminar held on 21 & 22 October 

2010 (IBN International) 

5. Mr. Chuah Seong Tat @ Chuah Chee Tat 






Rogers) 

6. Encik Mohd Nazri bin Md. Shariff 

• The CFO Symposium 2010 : Unlocking the 

Corporate Value held on 12 May 2010 (Malaysian 

Institute of Accountants) 



• Global Grains Trade Summit 2010 held on 28 & 

29 June 2010 (IBC Asia (S) Pte Ltd) 



• 16th Asia International Sugar Conference held on 

14 to 16 July 2010 (IBC Asia (S) Pte Ltd) 

• The Rice Trader held on 12 to14 October 2010 

(The Rice Trader) 

• KPMG Malaysian Tax Summit 2010 held on 21 

October 2010 (KPMG) 

• Accountants : Sustaining Value Creation held on 8 

to 11 November 2010 (International Federation of 

Accountants & Malaysian Institute of Accountants) 





The Directors also, from time to time, visit various operating 

units of the Group to obtain better understanding and 

perspective of the business and enhance their comprehension 

of the Group’s operations. 

F. THE BOARD COMMITTEES 

The Board has delegated certain functions to the Audit 

Committee, Executive Committee, Nomination Committee and 

Remuneration Committee to assist in the execution of its 

responsibilities. The Committees operate under clearly defined 

terms of reference. The Committees have the authority to 

examine particular issues within their terms of reference. The 

Chairman of the respective committees reports the outcome of 

the respective committee meetings with recommendations to 

the Board.

a) Audit Committee 

The Audit Committee reviews issues on accounting policy 

and presentation for external financial reporting, 

monitors the work of the internal audit team and ensures 

an objective and professional relationship is maintained 

with external auditors. 

The composition and the terms of reference of the Audit 

Committee and summary of its activities are as set out in 

the Audit Committee Report on pages 68 to 71. 

b) Executive Committee 

The Executive Committee deliberates on major 

operational issues and examines investment proposals 

before making appropriate recommendations to the 

Board. 

During the financial year, the Committee met twice and 

all members were present at the meetings. There were 

also numerous informal discussions and meetings held 

with the Management team to deliberate on operational 

issues. 

The members of the Executive Committee are as follows:- 

(i) Dato’ Wira Syed Abdul Jabbar bin Syed Hassan 

(ii) Bakry bin Hamzah 

(iii) Chuah Seong Tat @ Chuah Chee Tat 

c) Nomination Committee 

The Nomination Committee is primarily responsible to 

propose, consider and recommend to the Board, 

candidates for directorships to be filled in the Board and 

Committees of the Board. The Committee is also 

responsible to make appropriate recommendations to the 

Board on matters of renewal and extension of directors’ 

appointment and reappointment of retiring directors, to 

ensure that the Board has an appropriate balance of 

expertise and ability among non-executive directors and 

annually assess the effectiveness of the Board as a 

whole, the Board Committees and the contribution of 

directors, through assessment and evaluation processes. 

During the financial year, one (1) meeting was held and 

all members of the Nomination Committee were present. 

The members of the Nomination Committee are as 

follows:- 


(ii) Ooi Teik Huat 

(iii) Pakhruddin bin Sulaiman 

d) Remuneration Committee 


The Remuneration Committee is primarily responsible for 

recommending to the Board the remuneration and 

compensation of directors, including directors of 

subsidiary companies and the Chief Executive Officer. 

During the financial year, one (1) meeting was held and 

all members of the Remuneration Committee were 

present. The members of the Remuneration Committee 

are as follows:- 


(ii) Ooi Teik Huat 

(iii) Pakhruddin bin Sulaiman 

During the financial year, it was decided that the 

Nomination Committee and the Remuneration Committee 

be merged as the “Nomination and Remuneration 

Committee” to streamline the functions of the said 

committees with effect from 25 March 2010. 



61

DIRECTORS’ REMUNERATION 

The remuneration of Directors is determined at levels which 

enable the Company to attract and retain Directors with the 

relevant experience and expertise to manage the Group 

successfully. Their remuneration reflects the level of experience 

and expertise they bring with them and the level of responsibility 

undertaken by the Directors. 

Directors do not participate in decisions regarding their own 

remuneration packages. Directors’ fees are approved by the 

shareholders at the Annual General Meeting. 

The Directors are also paid attendance allowance for Board 

and Board Committee meetings that they attend. 

A summary of the remuneration of Directors of the Company 

during the financial year are set out below:- 

62 


STATEMENT ON 


Directors’ Emoluments Benefits- Total 

Fees In-Kind 

(RM’000) (RM’000) (RM’000) (RM’000) 

Non-Executive 

Directors 290 644 25 959* 

* The total remuneration includes fees and emoluments 

received from subsidiaries. 

There is no Executive Director on the Board of Directors of 

the Company. 



The number of Directors whose total remuneration falls within 

the following bands is as follows:- 

Range of Remuneration Number of Directors 

Non-Executive # 

RM50,001 to RM100,000 1 

RM100,001 to RM150,000 3 

RM150,001 to RM200,000 1 

RM200,001 to RM250,000 – 

RM250,001 to RM300,000 – 

RM300,001 to RM350,000 1 

# There is no Executive Director on the Board of Directors of 

the Company. 

SHAREHOLDERS RELATIONSHIP 

The Company places great importance in ensuring the highest 

standards of transparency and accountability in the disclosure 

of pertinent information to its shareholders as well as to 

potential investors and the public. The Company also 

recognizes the importance of timely and thorough 

dissemination of information to shareholders. In this regard, 

the Company strictly adheres to the disclosure requirements of 

Bursa Malaysia. The annual report has comprehensive 

information pertaining to the Company, while various 

disclosures on quarterly and annual results provide investors 

with financial information. Apart from the mandatory public 

announcements through Bursa Malaysia, the Company has 

also set up a website at “www.tpb.com.my” to provide 

corporate, financial and non-financial information. The 

Group’s senior management meets regularly with analysts, 

institutional shareholders and investors. At General Meetings, 

the Board encourages shareholder participation and responds 

to their questions. 

Shareholders can also leave written questions for the Board to 

respond. Any enquiries on the affairs of the Group may be 

conveyed to the Senior Independent Non-Executive Director, 

Mr Ooi Teik Huat, at the following:

Address: 

Tradewinds Plantation Berhad 




E-mail: twsplnt@tpb.com.my 

Tel : 03-2177 9999 

Fax : 03-2161 1701 

At all times, shareholders may contact the Company Secretary 

at the Company’s registered address and telephone number, 

as aforementioned, to convey any concerns or make queries. 

ACCOUNTABILITY AND AUDIT 

A. FINANCIAL REPORTING 

The Board aims to present a balanced and meaningful 

assessment of the Group’s financial performance and 

prospects, primarily through the annual financial statements 

and the quarterly announcement of results. 

In preparing the financial statements, the Directors have taken 

the necessary steps to ensure that the Group has adopted all the 

applicable accounting policies consistently. All financial 

reporting standards which the Board considers to be applicable, 

have been followed, subject to any explanations and material 

departures disclosed in the notes to the financial statements. 

The Board is assisted by the Audit Committee to review 

information to be disclosed through the annual audited financial 

statements and unaudited quarterly announcements of results to 

shareholders to ensure accuracy, adequacy and completeness. 

B. DIRECTORS’ RESPONSIBILITY STATEMENT 

The Board is responsible for ensuring that the financial 

statements of the Group give a true and fair view of the state 

of affairs of the Group and the Company at the end of the 

financial year and of the results and cash flows of the Group 

and the Company for the financial year. 

In preparing the financial statements, the Board has ensured 

that all applicable approved financial reporting standards in 

Malaysia and the provisions of the Act have been followed 

and the financial statements was prepared on the going 

concern basis as the Directors have a reasonable expectation, 

having made enquiries that the Group and the Company have 

adequate resources to continue in operational existence in the 

foreseeable future. 

The Directors are responsible for ensuring that the Company 

keeps accounting records that disclose with reasonable 

accuracy, the financial position of the Group and the Company 

and which enable them to ensure that the financial statements 

comply with the Act. 

C. INTERNAL CONTROL 


The Board acknowledges its ultimate responsibility for the 

Group’s system of internal controls and the need to review its 

effectiveness regularly in order to safeguard the Group’s 

assets and therefore the shareholders’ investments in the 

Group. 

The Statement on Internal Control as set out on pages 64 to 66 

of this Annual Report provides an overview of the state of 

internal control of the Company. 

D. RELATIONSHIP WITH THE AUDITORS 

The external auditors, Messrs BDO has continued to report to 

the members of the Company on their findings which are 

included as part of the Company’s financial reports with 

respect to each year’s audit on the statutory financial 

statements. In so doing, the Company has established a 

transparent arrangement with the auditors to meet the auditors’ 

professional requirements. The Audit Committee has also 

reviewed with the auditors the results of the annual audit and 

the audit report of the Company. 

This Statement is made in accordance with a resolution of the 

Board of Directors dated 20 April 2011. 



63

64 


STATEMENT ON 

INTERNAL CONTROL 

THE TRADEWINDS PLANTATION BERHAD GROUP’S (“THE GROUP”) 

SYSTEM OF INTERNAL CONTROL IS DESIGNED TO MEET THE 

GROUP’S BUSINESS OBJECTIVES AND SAFEGUARD THE GROUP’S 

ASSETS, SHAREHOLDERS’ INVESTMENTS AND THE INTERESTS OF 

CUSTOMERS, REGULATORS AND EMPLOYEES IN ACCORDANCE 

WITH S167A OF THE COMPANIES ACT, 1965. THE INTERNAL 

CONTROL SYSTEM COVERS THE AREAS OF RISK MANAGEMENT, 

FINANCE, OPERATIONS MANAGEMENT INFORMATION SYSTEM 

AND COMPLIANCE WITH THE RELEVANT LAWS AND REGULATIONS. 


Annual Report 2010

The Board of Directors (“the Board”) is ultimately responsible 

for the Group’s system of internal control, which includes the 

establishment of an appropriate control environment and 

framework, as well as reviewing its adequacy and efficiency. 

The Board acknowledges that risks cannot be completely 

eliminated. The system by its nature can only provide 

reasonable and not absolute assurance against material 

misstatement, operational failures, fraud or loss. 

RISK MANAGEMENT 

A formal group-wide enterprise risk management framework 

covering the Group’s core business activities to identify, 

evaluate and manage significant business risks that may affect 

the achievement of its business objectives has been approved 

by the Board and implemented. This enterprise risk 

management framework is continuously reviewed by the 

Board for its adequacy and effectiveness. 

Management is responsible to inculcate a risk-awareness 

culture and continuously reviewing the existing risk 

management framework to enhance risk awareness for 

managing risks and internal control, ensuring compliance with 

applicable laws and regulations and the policies adopted by 

the Board. 

The following key features have been incorporated in the 

Group’s risk management framework :- 

1. The Group reaffirms its on-going process of risk 

management by conducting relevant courses on risk 

awareness, risk assessment process and methodology to 

keep abreast with latest developments and requirements. 

The group-wide risk assessment process includes reevaluating 

existing key risk areas and identifying new 

key risk areas, potential impact and likelihood of those 

risks occurring, the effectiveness of control and adopting 

the appropriate action plans to mitigate those risks. 


The risk reports of each business unit and support services 

department across the Group are updated and presented 

to the Risk Management Committee for review and 

thereafter to the Board on a semi-annual basis on the 

significant risks and controls available to mitigate those 

risks. 

2. Evaluating key risks facing each business and operation 

of the Group, potential impact and likelihood of those 

occurring, the control effectiveness and action plans to 

manage those risks will continuously be carried out 

throughout various divisions, subsidiaries and 

departments by the Management. 

OTHER KEY ELEMENTS OF INTERNAL CONTROL 

Apart from the above, the other key elements of the Group’s 

internal control system which has been reviewed by the Board 

are described below:- 

1. Specific responsibilities have been delegated to the 

relevant Board Committees which have written Terms of 

Reference. These Committees have the authority to 

examine all matters within their scope of responsibility 

and report back to the Board with their recommendations. 

The ultimate responsibility for the final decision on all 

matters however lies with the Board. 

2. The management of the various companies in the Group 

is delegated to the respective heads of operation and 

their management teams, whose roles and responsibilities 

and authority limits are set by the holding company’s 

Board. 

3. The Management is responsible for the periodic review 

and stream lining of policy and procedural manuals to 

be adopted across the Group. These are supplemented 

by operating standards set by Management for 

application across the Group. 



65

66 


STATEMENT ON 

INTERNAL CONTROL 

4. There are specific procedures for both capital and 

revenue expenditures. 

5. Detailed budgeting process is established requiring all 

key operating companies in the Group to prepare 

budgets annually which are discussed and approved by 

their respective boards. 

6. Comprehensive management reports are provided 

quarterly to the Board for monitoring of the performance 

against the approved budget covering all key financial 

and operational indicators and compliance with all 

applicable rules and regulations. 

7. The Group Internal Audit provides the Audit Committee 

an independent assurance on the adequacy of risk 

management, internal control and governance systems. 

The Group Internal Audit carries out regular review on 

the business processes to assess the adequacy and 

effectiveness of internal control, compliance with 

regulations and the Group’s policies and procedures 

based on a risk-based audit approach. Results of such 

reviews are reported to the Audit Committee. 

The work of the internal auditors is in accordance with an 

annual audit plan approved by the Audit Committee at 

the beginning of the year. The head of Group Internal 

Audit reports to the Audit Committee. 

Formal procedures are in place for correction of 

weaknesses identified in the Internal Audit Reports. 

8. The Audit Committee holds meetings at least once every 

quar ter to deliberate on the audit findings, 

recommendations, management responses and corrective 

actions for improvement on the state of the internal 

control system. The minutes of the Audit Committee 

meetings are tabled to the Board. 



9 The Audit Committee meets regularly with senior 

management and the head of the Group Internal Audit to 

review the Company and the Group’s financial reporting, 

the nature, scope and results of audit review, and the 

effectiveness of the system of internal control. The Audit 

Committee meets with the external auditors without the 

presence of management team at least twice a year. 

The activities of the Audit Committee during the financial year 

ended 31 December 2010 are set out under the Report of the 

Audit Committee on pages 68 to 71 of this Annual Report. 

RELATIONSHIP WITH THE AUDITORS 

The Board maintains a formal and transparent professional 

relationship with the auditors through the Audit Committee. 

The role of the Audit Committee in relation to the internal and 

external auditors is described in the Report of the Audit 

Committee set out on pages 68 and 71 of this Annual Report. 

This Statement is made in accordance with a resolution of the 

Board of Directors dated 18 February 2011.




67

68 



REPORT 

THE BOARD OF DIRECTORS OF TRADEWINDS PLANTATION BERHAD 

IS PLEASED TO PRESENT THE REPORT ON THE AUDIT COMMITTEE 

OF THE BOARD FOR THE YEAR ENDED 31 DECEMBER 2010. 


Annual Report 2010

MEMBERS AND ATTENDANCE AT MEETINGS 

During the financial year ended 31 December 2010, the 

Audit Committee held a total of five meetings. Details of 

attendance by the Audit Committee members who were in 

office during the year under review are set out below: 

Name Meetings Attended 

# Ooi Teik Huat All 5 meetings 

Chairman 


Chuah Seong Tat @ Chuah Chee Tat All 5 meetings 

Member 


Director 

Pakhruddin bin Sulaiman All 5 meetings 

Member 


# A member of the Malaysian Institute of Accountants. 

TERMS OF REFERENCE OF THE AUDIT COMMITTEE 

OBjECTIVES 

The primary objective of the Audit Committee is to assist the 

Board in the effective discharge of its fiduciary responsibilities 

for corporate governance, financial reporting and internal 

control and compliance with financial reporting standards 

and Main Market Listing Requirements of Bursa Malaysia 

Securities Berhad. In addition, the Audit Committee will 

endeavour to adopt certain practices aimed at maintaining 

appropriate standards of corporate responsibility, integrity 

and accountability to the Company’s shareholders. 

COMPOSITION 

1. The members of the Audit Committee shall be appointed 

by the Board of Directors from amongst its non-executive 

Directors which shall fulfill the requirements of Bursa 

Malaysia Securities Berhad from time to time. 

2. No Alternate Director shall be appointed as a member of 

the Audit Committee. 

3. The members of the Audit Committee shall elect a 

Chairman from among the members who shall be an 

Independent Non-Executive Director. Should the 

Chairman be absent from any meeting, one of the 

members who shall be an Independent Non-Executive 

Director shall be elected as Chairman by the Audit 

Committee members. 

MEETINGS 


1. Meetings shall be held not less than four (4) times in a 

year. 

2. The presence of a majority of Independent Non-Executive 

Directors shall form a quorum for the Audit Committee 

Meetings. 

3. The Chief Executive Officer, Chief Financial Officer and 

representatives of the internal and/or external auditors 

shall attend meetings at the invitation of the Audit 

Committee. 

4. The Secretary to the Audit Committee shall be the 

Company Secretary or any other person appointed by 


5. The notice and agenda of each meeting shall be sent to 

all members of the Audit Committee and any other 

persons that may be required to attend. Minutes of each 

meeting shall be kept and distributed to each member of 

the Audit Committee and of the Board. The Audit 

Committee shall repor t and may make such 

recommendations to the Board on any audit and financial 

reporting matters, as it may think fit. 



69

AUTHORITY 

The Audit Committee shall have the following authority as 

empowered by the Board of Directors:- 

1. The authority to investigate any matters within its terms of 

reference. 

2. The resources which are required to perform its duties. 

3. Full and unrestricted access to any information and 

documents relevant to the Company’s activities. 

4. Direct communication channels with the external and 

internal auditors, and with the senior management of the 

Company. 

5. The ability to obtain external legal or independent 

professional or other advice. 

6. The ability to convene meetings with the external and 

internal auditors. 

FUNCTIONS 

70 



REPORT 

The Audit Committee shall undertake the following 

responsibilities and duties:- 

1. External Audit 

1.1 Consider and recommend the nomination and reappointment 

of the external auditors, the audit fee and 

any questions of resignation or dismissal. 

1.2 Review with the external auditors:- 

a) the scope and audit plan of the audit examination to 

ensure that adequate tests to verify the accounts and 

procedures of the Group will be performed and 

ensure coordination where more than one audit firm 

is involved; 

b) the evaluation of the effectiveness of internal control 

systems; and 

c) the audit reports. 

1.3 Review the assistance given by the employees to the 

external auditors. 



1.4 Discuss problems and reservations arising from the audit, 

and any matters the auditors may wish to discuss (in the 

absence of management where necessary). 

2. Internal Audit 

2.1 Review the adequacy of the scope, functions and 

resources of the internal audit functions and that it has the 

necessary authority to carry out its work. 

2.2 Review the internal audit programme and results of the 

internal audit processes, and where necessary ensure 

that appropriate actions are taken on the recommendations 

of the internal audit function. 

3. Financial Reporting 

Review the unaudited quarterly results and year end 

financial statements, prior to the approval by the Board 

of Directors, focusing particularly on:- 

a) the nature and impact of any changes in or 

implementation of major accounting policy changes 

and practices; 

b) significant and unusual events; 

c) compliance with the financial reporting standards 

and other legal and regulatory requirements; and 

d) adequacy of accounting, financial and operating 

controls and to monitor the implementation of any 

recommendations made. 

4. Related Party Transactions 

To review any related party transactions and conflict of 

interest situation that may arise within the Company or 

Group including any transaction, procedure or course of 

conduct that raise questions of management integrity and 

the adequacy of the Group’s procedures for monitoring 

and reviewing of related party transactions. 

5. Risk Management 

Review the adequacy and effectiveness of risk 

management, internal control and governance systems 

instituted in the Group.

6. Other Matters 

Perform such other responsibilities as may be agreed by 

the Board. 

SUMMARY OF ACTIVITIES DURING THE FINANCIAL 

YEAR 

In line with its terms of reference, the following main activities 

were undertaken by the Audit Committee for the financial year 

in the discharge of its functions and duties:- 

1. Reviewed the quarterly financial results and the annual 

audited financial statements of the Group and the 

Company for the financial year ended 31 December 

2010 prior to recommending the same to the Board of 

Directors for its approval. 

2. Reviewed with the external auditors the findings of the 

statutory audit and audit reports, particularly issues 

raised in the management letter and ensured where 

appropriate, necessary corrective actions are taken by 

management. 

3. Reviewed with the external auditors the audit strategy, 

scope of work and proposed fees for the statutory audit 

for the financial year ended 31 December 2010. 

4. Reviewed with the internal auditors the annual audit plan 

proposed to ensure adequacy of the scope and coverage. 

5. Reviewed with the internal auditors all internal audit 

reports on the results of the audit activities undertaken 

together with the recommend actions and their 

implementation status. 

6. Reviewed and recommended the Statement on Internal 

Control and Audit Committee Report to the Board of 

Directors for approval. 

7. Reviewed the related party transactions entered into by 

the Group to ensure that all transactions made are in 

compliance with the Main Market Listing Requirements of 

Bursa Malaysia Securities Berhad. 

8. Reviewed the Group’s compliance with the provisions of 

the Main Market Listing Requirements of Bursa Malaysia 

Securities Berhad and other regulatory authorities and 

monitored regularly the actions taken on issues of noncompliance 

that have been reported to the Board. 

INTERNAL AUDIT FUNCTION AND ACTIVITIES FOR 

THE FINANCIAL YEAR 

The Group outsourced the internal audit function from the 

Group Internal Audit Department of the Holding Company, 

which primary function is to assist the Audit Committee in 

discharging its duties and responsibilities. Its role is to provide 

the Audit Committee with independent and objective reports on 

the state of internal controls of the operations within the Group 

and the extent of compliance by such operations with the 

Group’s established policies and procedures. 

The internal audit function is guided by its Audit Charter and 

the Head of the Group Internal Audit Department reports to 


The Audit Committee reviews and thereafter, approves the 

annual internal audit plan at the beginning of each year. The 

internal audit function adopts a risk-based auditing approach 

towards the preparation of the audit plan and conduct of audits 

which are consistent with the Group’s framework in designing, 

implementing and monitoring its internal control system. 

Throughout the financial year, audit assignments, investigations 

and follow-ups were carried out on units of operations and 

subsidiaries. These were carried out in accordance with the 

annual internal audit plan or as special audits. Upon completion 

of the audits, the reports of the audits undertaken were presented 

to the Audit Committee and forwarded to the parties concerned 

for their necessary action. The internal audit function monitors 

the progress of the implementation of the audit recommendations 

in order to obtain assurance that all major risks and control 

concerns have been duly addressed by the management of the 

Company. 

Ooi Teik Huat 

Chairman of Audit Committee 

20 April 2011 




71

72 


ADDITIONAL COMPLIANCE 

INFORMATION 

IN COMPLIANCE WITH THE MAIN MARKET LISTING REQUIREMENTS 

OF BURSA MALAYSIA SECURITIES BERHAD, THE FOLLOWING IS 

PROVIDED:- 

1. Non-Audit Fees 

The amount of non-audit fees incurred for services 

rendered to the Group by the Company’s external 

auditors or their affiliated companies for the financial 

year ended 31 December 2010 was RM2,500. 

2. Material Contracts Involving Directors and Major 

Shareholders 

Save as disclosed below, there were no other material 

contracts which have been entered into by the Company 

and its subsidiaries involving directors’ and major 

shareholders’ interests either still subsisting at the end of 

the financial year or, if not then subsisting, entered into 

since the end of the previous financial year: 

2.1 A conditional share sale agreement dated 30 

October 2009 entered into between Prisma Spektra 

Sdn Bhd, a wholly-owned subsidiary of the 

Company and Semi Bayu Sdn Bhd (273712-D) for 

the acquisition of 125,709,000 ordinary shares of 

RM1.00 each, representing the entire issued and 

paid-up ordinary share capital of MARDEC Berhad 

(8922-A) for a total purchase consideration of 

RM150.0 million. By a supplemental agreement 

dated 25 February 2011, the parties mutually 

agreed to revise the purchase consideration for the 

sale shares to RM140.0 million. The said conditional 

share sale agreement is still pending completion. 



Details of the Relationship 

Tan Sri Dato’ Seri Syed Mokhtar Shah bin Syed Nor 

is deemed to be a major shareholder of Tradewinds 

Plantation Berhad by virtue of his indirect equity 

interest in Tradewinds (M) Berhad, the holding 

company of Tradewinds Plantation Berhad. 

Encik Bakry bin Hamzah, a Non-Independent and 

Non-Executive Director of Tradewinds Plantation 

Berhad, is a 57% shareholder of Damai Akrab Sdn 

Bhd, which in turn has a 55% equity interest in Semi 

Bayu Sdn Bhd. Encik Bakry bin Hamzah is also a 

director of Damai Akrab Sdn Bhd and Semi Bayu 

Sdn Bhd. Encik Bakry bin Hamzah is also a Director 

of Restu Jernih Sdn Bhd, an indirect major 

shareholder of Tradewinds Plantation Berhad in 

which Tan Sri Dato’ Seri Syed Mokhtar Shah bin 

Syed Nor is a major shareholder. 

Mr. Chuah Seong Tat @ Chuah Chee Tat who is a 

Non-Independent and Non-Executive Director of 

Tradewinds Plantation Berhad is a director of 

Bukhary Sdn Bhd, a private limited company in 


Syed Nor, the major shareholder of Tradewinds 

Plantation Berhad, has interest. 

Encik Mohd. Nazri bin Md. Shariff is a representative 

of Tradewinds (M) Berhad on the Board of 

Tradewinds Plantation Berhad as a Non-Independent 

Non-Executive Director, the holding company in 


Syed Nor is a major shareholder.

3. Imposition of Sanctions/Penalties on the Company and 

its Subsidiaries for the Financial Year Ended 31 December 

2010 

There were no sanctions or penalties imposed on the 

Company, its subsidiaries, Board members and 

Management for the financial year ended 31 December 

2010. 

4. Revaluation of Landed Properties 

The Group did not revalue its landed properties as its 

principal landed properties are agricultural land, used 

for the cultivation of oil palm and rubber. 

5. Share Buybacks 

The Company did not purchase any of its own shares 

during the financial year. 

6. Option, Warrants or Convertible Securities 

The Company did not offer any options or warrants 


7. American Depository Receipt (ADR) or Global Depository 

Receipt (GDR) Programme 

The Company did not sponsor any ADR or GDR 

programme during the financial year. 

8. Profit Estimate, Forecast or Projection 

The Company did not make any release on the profit 

estimate, forecast or projection for the financial year. 


9. Profit Guarantee 

No profit guarantee was given by the Company in 

respect of the financial year. 

10. Status of Utilisation of Proceeds Raised from Corporate 

Proposal 

There was no corporate proposal involving funds raising. 

11. Public Shareholding Spread 

As at 25 April 2011, the Company has a public 

shareholding spread of 16.49% of its total issued and 

paid-up share capital held by 7,021 public shareholders. 

Bursa Malaysia Securities Berhad had on 16 September 

2008, approved the Company’s application for 

acceptance of lower level of public shareholding spread 

of 16.49% of the Company’s issued and paid-up share 

capital as being in compliance with the public 

shareholding spread requirement pursuant to Paragraph 

8.02 of the Main Market Listing Requirements of Bursa 

Malaysia Securities Berhad. 

12. Contracts Relating to Loans 

There were no contracts relating to loans by the Company 

involving Directors and major shareholders. 



73

74 


ADDITIONAL COMPLIANCE 

INFORMATION 

13. Disclosure of Recurrent Related Party Transactions of a Revenue or Trading Nature (RRPT) 

The RRPT entered into by the Group during the financial year ended 31 December 2010 are disclosed as follows:- 

NATURE OF TRANSACTIONS RELATED PARTIES NATURE OF RELATIONSHIP 

WITH THE GROUP AND 

COMPANY 

PROVISION OF PLANTATION 

MANAGEMENT AND ADVISORY 

SERVICES 

Plantation manager and agent 

Tradewinds Agro Services 

Sdn Bhd 

SALE OF FRESH FRUIT BUNCHES 

Vendor 

Amalan Pelita Pasai Sdn Bhd 

PROCUREMENT OF 

TRANSPORTATION SERVICES 

Purchaser 

Ladang Petri Tenggara Sdn Bhd 

PROCUREMENT OF 

MANAGEMENT AND ADVISORY 

SERVICES 

Purchaser 

Tradewinds Plantation Berhad 



Plantation owner 

Retus Plantation Sdn Bhd 

(“Retus”) 

Purchaser 

Retus 

Vendor 

JP Logistics Sdn Bhd (“JPL”) 

Vendor 

Tradewinds (M) Berhad 

(“TWM”) 

Retus is a 60% subsidiary of 

TWM. 

JPL is a 100% owned subsidiary 

of Johor Port Berhad which is 

a company related to Tan Sri 

Dato’ Seri Syed Mokhtar, 

pursuant to Section 6A of the 

Companies Act, 1965. 

TWM is a major shareholder 

and the holding company of 

the Company. 

AGGREGATE VALUE 

OF THE 

TRANSACTIONS FOR 

THE YEAR ENDED 

31 DECEMBER 2010 

(RM’000) 

2,660 

7,114 

341 

1,200

NATURE OF TRANSACTIONS RELATED PARTIES NATURE OF RELATIONSHIP 

WITH THE GROUP AND 

COMPANY 

SALE OF CRUDE PALM OIL AND 

PALM KERNEL 

Vendors 

Ladang Permai Sdn Bhd 

Ladang Serasa Sdn Bhd 

PURCHASE OF GERMINATED OIL 

PALM SEEDS 

Purchasers 

Pertanian Johor Tenggara 

Sdn Bhd 

Teon Choon Realty Company 

Sdn Bhd 

Ladang Petri Tenggara Sdn Bhd 

Quek Shin & Sons Pte Ltd 

Melur Gemilang Sdn Bhd 

Usaha Wawasan Sdn Bhd 

Purchaser 

Felda Marketing Services 

Sdn Bhd (“FMS”) 

Vendor 

Felda Agricultural Services 

Sdn Bhd (“FAS”) 

FMS and FAS are companies 

related to Felda Global 

Ventures Holdings Sdn Bhd 

which in turn is the 

Company’s indirect major 

shareholder 


AGGREGATE VALUE 

OF THE 

TRANSACTIONS FOR 

THE YEAR ENDED 


(RM’000) 

17,346 

41,500 

41 

45 

105 

38 

32 

162 



75

STRATEGIC INNOVATIONS 

We are committed in delivering the most comprehensive technology 

and innovative methods in our research and development while 

constantly relying on our unwavering dedication to explore and 

discover new breakthroughs as well as enhance yield potential.

CORPORATE SOCIAL 

RESPONSIBILITY

80 

CORPORATE SOCIAL RESPONSIBILITY 



SHARINg OuR SuCCESS 

CORPORATE SOCIAL RESPONSIBILITY (“CSR”) HAS ALWAYS BEEN A POINT Of REfERENCE 

IN THE WAY WE CONDuCT OuR BuSINESS, uNDERSCORINg OuR SENSITIvITY TO OuR 

STAkEHOLDERS, THE COmmuNITY IN WHICH WE SERvE AND OuR RESPECT fOR THE 

ENvIRONmENT. guIDED BY OuR OWN mORAL COmPASS AND TAkINg OuR CuE 

fROm BuRSA mALAYSIA’S CSR fRAmEWORk fOR PuBLIC LISTED COmPANIES LAuNCHED 

IN SEPTEmBER 2006, THE gROuP’S OuTREACH PROgRAmmES REST ON fOuR mAIN 

PILLARS: WORkPLACE DEvELOPmENT, COmmuNITY DEvELOPmENT, mARkETPLACE 

DEvELOPmENT AND ENvIRONmENTAL SuSTAINABILITY. 


Annual Report 2010

WORKPLACE DEVELOPMENT 

Employee Welfare. Our plantation 

workers are truly the backbone of the 

Group’s operations. Taking care of their 

needs goes beyond providing them with 

a roof over their heads. Much thought 

and planning has gone into the design 

and construction of accommodation for 

various categories of staff in all of our 

estates. The care taken has greatly 

contributed towards an improved and 

more conducive living environment that 

our people can truly call home. 

We have also looked into water supply 

issues. In ensuring an adequate and 

clean water supply, we have studied 

various alternatives such as underground 

sources, surface reservoirs, wells and 

public and private water suppliers. This 

initiative has already benefited residents 

at the Retus Estate Complex in Sibu. 

Retus Plantation Group of estates is 

currently managed by TPB. We continue 

to keep a watchful eye on the water 

supply needs of other estates, which will 

be upgraded as and when required. 

Many of our housing estates are virtually 

self-contained communities in their own 

rights, with a host of amenities provided 

such as places of worship, clinics, 

kindergartens, crèches, club houses as 

well as recreational and sports facilities. 

Rather than becoming enclaves 

providing comfort and convenience to 

our staff, they also serve the needs of 

the greater community, drawing folks 

from the neighbourhood to enjoy the 

amenities. In this way, we earn a place 

in the local community, gaining its 

respect as a valued and trusted 

neighbour. 

While we encourage our people to 

work hard as a bedrock element of our 

success, we ensure that this is balanced 

with time set aside for social and 

recreational activities. Given the 

geographical spread of the Group’s 

operations, inter-regional sports and 

other recreational activities such as 

Family Day, Annual Dinner, festive 

gatherings and company outings bring 

employees together from across the 

Group. 


A continuous learning curve. Human 

capital development is the ver y 

foundation upon which we can build a 

brighter future. We take the view that 

every employee is important and has a 

critical role to play not only in the Group’s 

ongoing and future success but to achieve 

the national aspiration of revitalising the 

agriculture sector to become the nation’s 

third engine of growth. The Tenth 

Malaysia Plan 2011-2015 has focused 

on skills development as one of the 

enablers of productivity and to facilitate 

the sector’s move up the value chain. In 

the past few years, the Company has 

extended study loans or grants to the 

deserving employees to pursue tertiary 

education to a higher level. 



81

82 




In line with the national thrust on lifelong 

learning and to raise the Group’s 

capacity for knowledge and innovation, 

the Group has invested and will 

continue to invest in human capital 

development programmes. In today’s 

increasingly competitive business 

e n v i r o n m e n t , k n o w l e d g e a n d 

technology are the prerequisite elements 

to staying ahead. 

The Tradewinds Plantation Academy 

(“TPA”), located in Sibu, Sarawak, has 

been set up to provide training at both 

professional and academic levels to 

employees and the industry as a whole. 

TPA’s training philosophy is simply to 

ensure that the training content best 

matches the needs of the Group’s 

operations. As such, the training 

curriculum has been designed to equip 

our workforce with the necessary skills, 

knowledge and hands-on experience 

for optimal performance. 

Through the training effort, we have 

been able to build a valuable talent 

pool, which is one of the contributing 

factors to the Group’s success. The year 

under review saw no less than 30 



training programmes conducted 

throughout our operating units, involving 

all categories of staff from field and 

estate workers right up to the managerial 

level. Most of the programmes are 

conducted by the Group’s pool of 

training specialists at TPA. However, we 

also draw upon the expertise of staff 

from various disciplines to impart their 

knowledge and experience. Our inhouse 

training is complemented by 

courses conducted by external trainers 

to impart the specialised knowledge 

and skills not available within the 

Group. 

COMMUNITY DEVELOPMENT 

As planters, it is our goal to plant roots 

deep into the various communities in 

which we operate. The seeds for 

establishing good community relations 

were sown from the very outset. Over 

the years, we have carefully nurtured 

the seedlings to maturity and now we 

are reaping intangible rewards by way 

of having earned the respect of the 

community as a trusted neighbour and 

friend. 

During the year, the Group continued to 

lend its support to the under-privileged, 

welfare homes, shelters, mosques and 

various educational institutions 

throughout the country. Apart from these 

worthy causes, we have sponsored 

seminars and workshops that are 

relevant to the business community. In 

July 2010, the Company was the cosponsor 

of a power-packed seminar 

entitled ‘Investment Opportunities for 

2010 and Beyond for Asian Companies 

and Investors’ by Jim Rogers, an author, 

financial commentator and successful 

international investor. In recognition of 

the important role played by women in 

today’s business world, the Company 

was proud to be one of the main 

sponsors of the ‘Asian Women of 

Influence Summit 2010’, officiated by 

Y.A.Bhg Datin Paduka Seri Rosmah 

Mansor.

However, the new thinking about CSR 

and community development goes 

beyond philanthropy. The key word is 

engagement and the Group has 

demonstrated this commitment by 

breaking fast with orphans and local 

communities during the holy month of 

Ramadhan. The Group’s culture of 

caring and sharing has cascaded down 

to the employees, who have given their 

time and energy to participate in many 

‘gotong royong’ or self-help projects 

organised by the local communities. 

During the year, a Safety and Health 

Camp was organised by the Northern 

Peninsular Region for residents of 

Ladang Serasa. The main objective of 

the camp, which saw the participation 

of the Fire Department, Department of 

Occupational Safety and Health, Kuala 

Krai Hospital and local medical clinics, 

was to educate residents on issues 

pertaining to safety and health. A blood 

donation drive was held in conjunction 

with the camp and as in other 

campaigns, we take pride in the very 

positive response from our staff. This is 

probably the greatest gift that one can 

give to the community – the gift of life. 

Among our more enduring and farreaching 

CSR legacies will be our 

involvement in the longer-term projects 

such as the Rural Electrification Project 

in Zone One A in Miri, Sarawak which 

was completed during the year under 

review. Initiated by the Ministry of Rural 

and Regional Development, the project 

is aimed at improving the quality of life 

of rural communities. Electricity is now 

supplied to three long-houses within the 

vicinity of Binu Estate. 

As in previous years, our mills as well as 

the corporate office, continue to serve 

as an industrial training ground for 

college and university students, giving 

them a unique opportunity to gain firsthand 

experience and a head-start when 

they enter the job market. We have also 

opened our doors to delegations from 


g o v e r n m e n t d e p a r t m e n t s , n o n - 

governmental organisations and 

members of the public and the 

neighbouring communities who would 

like to learn more about our operations. 

MARKETPLACE DEVELOPMENT 

The Group aims to be open and 

transparent in its dealings with the 

investing community, shareholders, 

customers and other stakeholders. We 

have therefore established several 

platforms to communicate with our 

various publics, and in this digital age, 

our website is one of the most accessible 

sources of information. 

In compliance with the Roundtable 

Sustainable Palm Oil (“RSPO”) criteria 

for certification, a meeting with our 

respective stakeholders was held on 11 

November 2010. Stakeholders who 

attended the meeting, included 

representatives from the government, 

National Union of Plantation Workers 

and community members, have given 

encouraging endorsements to the 

Group. 



83

84 




ENVIRONMENTAL 

SUSTAINABILITY 

All business activities will have impact 

on the environment. But as a responsible 

corporate citizen, the onus is on us to 

ensure that the benefits of development 

are not negated by its adverse effects 

on the environment. We have, therefore, 

put in place an Environmental 

Management System that complies with 

the stringent requirements of the MS 

ISO 14001 Standards and the 

Environmental Quality Act 1974 that 

provides a framework for environmental 

requirements in Malaysia. 

In ensuring environmental sustainability, 

we have also adopted good agriculture 

practices and agronomic management 

covering the following areas: soil and 

water conservation; integrated pest 



management; nutrient balancing; fresh 

fruit bunches evacuation; waste 

recycling; pollution control and fragile 

soils management, among others. These 

practices are in line with the RSPO 

Principles and Criteria, a prerequisite 

for certification. 

Intensive research conducted in-house 

has given the Company a leadership 

position in peat soil development. 

Through efficient nutrient management, 

sound water management and effective 

pest and disease control, the Group has 

successfully transformed peat soil into 

an efficient and productive planting 

medium. This was achieved with due 

regard to environmental aspects such as 

the conservation of the unique flora and 

fauna on peat land. The Group’s 

experience has been documented in a 

paper entitled ‘Development of Oil Palm 

on Peat: A Socio-economic Perspective’, 

which was presented to the international 

audience in Krabi, Thailand. 

The Group continues to invest in new 

installations and technology to alleviate 

the problems of green-house gas 

emissions and water pollution at its 

mills. Recent initiatives include the 

installation of a Continuous Emission 

Monitoring system and the construction 

of a tertiary treatment plant to reduce 

the Biochemical Oxygen Demand and 

Total Suspended Solids levels in Palm 

Oil Mill Effluents (“POME”) before it is 

discharged. The Group is also studying 

various proposals to utilise methane 

gas, a by-product in the anaerobic 

treatment of POME, for energy 

generation.

SAfETY, HEALTH, 

ENvIRONmENT AND QuALITY 

RAising ThE BAR 

OccupATiOnAl sAfETy And hEAlTh pOlicy. 

AS ENCAPSuLATED IN THE gROuP’S OCCuPATIONAL SAfETY 

AND HEALTH (“OSH”) POLICY, THE gROuP IS fuLLY COmmITTED 

TO ENSuRE THE SAfETY, HEALTH AND WELL-BEINg Of ITS 

EmPLOYEES AND TO PROTECT THEm AgAINST RISkS. HAvINg 

TAkEN THE ROAD TO SuSTAINABILITY, OSH IS AN INTEgRAL 

PART Of THE gROuP’S CSR PROgRAmmE AND A kEY ELEmENT 

IN ATTAININg RSPO CERTIfICATION. AS AN INDICATION Of 

ITS gROWINg ImPORTANCE, THE ANNuAL ALLOCATION fOR 

PROmOTINg OSH IN THE WORkPLACE HAS BEEN STEADILY 

PROvIDED OvER THE YEARS. 




85

86 


SAfETY, HEALTH, 

ENvIRONmENT AND QuALITY 

Our objective is not only to comply with 

the statutory requirements but to 

inculcate a culture within the Group 

whereby OSH becomes ingrained as a 

way of life in the work-place. The seeds 

for a nascent OSH culture have already 

been sown, but they need to be 

continually nurtured before coming to 

full bloom. This calls for the full 

commitment of staff across all levels, 

with the top management leading by 

example. 

Osh performance. As borne out by the 

numbers, financial year 2010 was a 

commendable year on the OSH front. 

The OSH Compliance Project was 

launched in July 2009 to gauge the 

level of OSH compliance among 

operating units. From a level of 57.85% 

achieved during the first audit conducted 

in October 2009, the level of 

compliance rose to 90.90% at the end 

of December 2010. It is expected that 

all the selected operating units will be 

fully compliant by early 2011. 

The Group continued to register a yearon-year 

improvement in its safety record 

measured in terms of the number of 

accident cases, number of work days 

lost, cases for every 1,000 workers and 

fatal cases reported. The number of 

accident cases in 2010 has fallen to 

31, compared to 39 reported in 2009. 

More importantly, we have reduced the 

number of fatalities to zero, from 2 

reported in the previous year. 



programmes and Activities. Safety 

audits were conducted throughout the 

year by TPB’s Safety and Health Officer 

a s w e l l a s t h e D e p a r t m e n t o f 

Occupational Safety and Health 

(“DOSH”). No major issues were 

reported by the DOSH audits, whose 

findings also indicate that all the 

operating units had met the minimum 

OSH requirements stipulated under the 

OSH Compliance Project. 

Other programmes rolled out during the 

year included a Health and Safety 

Campaign in the Northern Peninsular 

Region. The campaign was held on 23 

March and invited guests included 

representatives from the relevant 

government departments. Among the 

activities were a safety talk by the 

Director of DOSH, Kelantan; a blood 

donation drive; health and dental checkups 

and demonstrations on fire-fighting 

and how to administer cardiopulmonary 

resuscitation. 

going for ward. While our OSH 

performance in 2010 has been 

generally satisfactory, we cannot afford 

to rest on our laurels, not when the 

stakes are so high. The Group will 

continue to pursue a zero tolerance 

stance as far as safety is concerned. 

Phase 2 of the OSH Compliance Project 

will be launched in 2011, with an 

emphasis on health, welfare and 

environmental matters. 

The Group will continue to invest in 

OSH not only because it makes good 

business sense, but by doing so, we are 

protecting the well-being of our greatest 

asset – our human capital. 

THE QUEST FOR QUALITY 

Quality is one of the key ingredients to 

the Group’s success and will continue to 

play a pivotal role as we strive to bring 

the Group to even greater heights. 

Spear-headed by the Total Quality 

Environmental Management Strategic 

Business Unit (“TQEM-SBU”), our quest 

for quality excellence is never-ending. 

Each year we set new targets and strive 

for continual improvements in all aspects 

of our operations, laying the foundations 

for a quality mind-set and culture among 

our people. 

Quality Audits. To reinforce the quality 

culture, TQEM-SBU began implementing 

quality audits during the year under 

review. These audits have a two-fold 

objective; the first is to facilitate an 

independent inspection on harvesting 

activities and milling operations to 

determine if they meet quality standards. 

The other objective is to ensure 

adherence to the Basic Policy Guidelines 

by the respective operating units 

(“OPUs”). Performance that fails to meet 

quality requirements can be identified 

and recommendations can be relayed 

to the OPUs concerned so that remedial 

action can be taken. During the year, 

TQEM-SBU focused its attention on the 

Kuching and Mukah districts, conducting 

audits in eight OPUs.

improved Extraction Rates. In our quality 

initiatives, one of our most important 

goals is the improvement of the oil 

extraction rate (“OER”) and kernel 

extraction rate (“KER”) achieved by the 

Group’s eight palm oil mills. During the 

year under review, the OER and KER 

had improved to 21.54% and 5.35% 

respectively as compared to 21.20% 

and 5.31% recorded in 2009. Five 

mills achieved an average OER that 

was above 21.00% in 2010, from only 

four in 2009. 

These achievements also underscore the 

important role played by the Joint 

Consultative Committees (“JCC”). The 

JCC is composed of estate and mill 

personnel and was set up in 2007 as a 

quality improvement initiative. The 12 

JCCs that have been established 

provide a useful function in identifying 

problems, recommending solutions, 

resolving conflicts and sharing 

information with other JCC teams. 

Quality day. A regular feature on TPB’s 

corporate calendar, Quality Day serves 

as a useful platform for JCC teams to 

challenge the status quo and to map out 

n e w s t r a t e g i e s f o r c o n t i n u a l 

improvements, the objective being to 

reduce costs, while increasing 

productivity and revenue for the Group. 

During the year, the Sibu, Southern 

Peninsular, Miri and Northern Peninsular 

Regions have held their Quality Day. 

For the Sabah/Lawas and Kuching 

regions, the events are scheduled in 

2011. 

isO and RspO certification. Established 

by the International Organisation for 

Standardisation, the ISO 9000 family 

of standards is an internationally 

recognised standard for a quality 

management system. Accreditation to 

ISO is a stringent process involving 

many steps. During the year, the Sg. 

Kachur Palm Oil Mill and the Ulu Sebol 

Palm Oil Mill earned their certifications 


to ISO 9001:2008 on 16 July and 6 

September 2010 respectively. Our 

journey towards quality excellence does 

not end here. With most of the good 

practices in place, the Group has set its 

sights on implementing a Total Quality 

Management System. 

In the present world of increasing 

environmental and social consciousness, 

there is growing concern that products 

are produced without undue harm to 

the environment or society. RSPO 

certification is a seal of approval 

allaying such fears, taking into account 

not only good agricultural practices but 

a l s o r e s p o n s i b l e s o c i a l a n d 

environmental management. Having 

completed the earlier preparation, a 

meeting with stakeholders was 

convened on 11 November 2010 as 

required by the RSPO Principles and 

Criteria. 



87

STRATEGIC REACH 

We are increasing the momentum forward as 

we surge ahead in pursuit of unlocking new 

markets of vast potentials and tap existing 

opportunities from emerging markets such as 

China and India

90 

FINANCIAL STATEMENTS 

FINANCIAL 

STATEMENTS 

91 Directors’ Report 

97 Statement By Directors 

97 Statutory Declaration 

98 Independent Auditors’ Report 

100 Statements Of Financial Position 

102 Statements Of Comprehensive Income 

104 Statements Of Changes In Equity 

106 Statements Of Cash Flows 

109 Notes To The Financial Statements 


Annual Report 2010

DIRECTORS’ REPORT 

The Directors have pleasure in submitting their report and the audited financial statements of the Group and of the Company for 

the financial year ended 31 December 2010. 

PRINCIPAL ACTIVITIES 

The principal activities of the Company are investment holding and provision of management services to the subsidiaries. The 

principal activities of the subsidiaries are set out in Note 9 to the financial statements. 

There have been no significant changes in the nature of these activities during the financial year. 

RESULTS 

Group Company 

RM’000 RM’000 

Profit for the financial year 211,956 32,446 

Attributable to: 

Owners of the parent 186,404 32,446 

Minority interest 25,552 – 

DIVIDEND 


211,956 32,446 

Dividend on ordinary shares paid or declared by the Company since the end of the previous financial year were as follows: 



Company 

RM’000 

In respect of the financial year ended 31 December 2009: 

Final gross dividend of 6.00 sen per ordinary share, less tax at 25% 

(4.50 sen net per ordinary share), paid on 28 July 2010 23,812 

In respect of the financial year ended 31 December 2010: 

1st interim gross dividend of 5.00 sen per ordinary share, less tax at 25% 

(3.75 sen net per ordinary share), paid on 30 December 2010 19,843 

The Directors proposed a final gross dividend of 5.00 sen per ordinary share, less tax at 25%, amounting to RM19,843,254 

(3.75 sen net per ordinary share) in respect of the financial year ended 31 December 2010 subject to the approval of members 

at the forthcoming Annual General Meeting of the Company. 

91

RESERVES AND PROVISIONS 

There were no material transfers to or from reserves or provisions during the financial year. 

ISSUE OF SHARES AND DEBENTURES 

There were no issues of new shares or debentures during the financial year. 

OPTIONS GRANTED OVER UNISSUED SHARES 

No options were granted to any person to take up unissued shares of the Company during the financial year. 

DIRECTORS 

92 



The Directors who held office since the date of the last report are: 

Dato’ Wira Syed Abdul Jabbar bin Syed Hassan 

Ooi Teik Huat 




Mohd Nazri bin Md. Shariff 

DIRECTORS’ INTERESTS 

The Directors holding office at the end of the financial year and their beneficial interests in ordinary shares of the Company 

and of its related corporations during the financial year ended 31 December 2010 as recorded in the Register of Directors’ 

Shareholdings kept by the Company under Section 134 of the Companies Act, 1965 were as follows: 

Number of ordinary shares of RM1.00 each 

Balance Balance 

as at as at 

Shares in the Company 1.1.2010 Addition Disposal 31.12.2010 

Dato’ Wira Syed Abdul Jabbar bin Syed Hassan 15,000 - - 15,000 

Pakhruddin bin Sulaiman 9,000 - - 9,000 

None of the other Directors holding office at the end of the financial year held any beneficial interests in the ordinary shares of 

the Company and of its related corporations during the financial year. 


Annual Report 2010

DIRECTORS’ BENEFITS 

Since the end of the previous financial year, none of the Directors have received or become entitled to receive any benefit (other 

than a benefit included in the aggregate amount of emoluments received or due and receivable by the Directors as shown in 

Note 30 to the financial statements) by reason of a contract made by the Company or a related corporation with the Director or 

with a firm of which the Director is a member, or with a company in which the Director has a substantial financial interest other 

than the following: 

(i) remuneration received by certain Directors as directors or executives of the holding company and its subsidiaries; and 

(ii) deemed benefits arising from related party transactions as disclosed in Note 38 to the financial statements. 

There were no arrangements during and at the end of the financial year, to which the Company is a party, which had the object 

of enabling the Directors of the Company to acquire benefits by means of the acquisition of shares in or debentures of the 

Company or any other body corporate. 

OTHER STATUTORY INFORMATION REGARDING THE GROUP AND THE COMPANY 

(I) AS AT THE END OF THE FINANCIAL YEAR 

(a) Before the statements of comprehensive income and statements of financial position of the Group and of the Company 

were made out, the Directors took reasonable steps: 

(i) to ascertain that proper action had been taken in relation to the writing off of bad debts and the making of 

provision for doubtful debts and have satisfied themselves that all known bad debts had been written off and that 

adequate provision had been made for doubtful debts; and 

(ii) to ensure that any current assets other than debts, which were unlikely to realise their book values in the ordinary 

course of business had been written down to their estimated realisable values. 

(b) In the opinion of the Directors, the results of the operations of the Group and of the Company during the financial year 

have not been substantially affected by any item, transaction or event of a material and unusual nature. 

(II) FROM THE END OF THE FINANCIAL YEAR TO THE DATE OF THIS REPORT 

(c) The Directors are not aware of any circumstances: 


(i) which would render the amounts written off for bad debts or the amount of the provision for doubtful debts in the 

financial statements of the Group and of the Company inadequate to any material extent; 

(ii) which would render the values attributed to current assets in the financial statements of the Group and of the 

Company misleading; and 

(iii) which have arisen which would render adherence to the existing method of valuation of assets or liabilities of the 

Group and of the Company misleading or inappropriate. 



93

94 



OTHER STATUTORY INFORMATION REGARDING THE GROUP AND THE COMPANY (continued) 

(II) FROM THE END OF THE FINANCIAL YEAR TO THE DATE OF THIS REPORT (continued) 

(d) In the opinion of the Directors: 

(i) there has not arisen any item, transaction or event of a material and unusual nature likely to affect substantially 

the results of the operations of the Group and of the Company for the financial year in which this report is made; 

and 

(ii) no contingent or other liability has become enforceable, or is likely to become enforceable, within the period of 

twelve (12) months after the end of the financial year which will or may affect the ability of the Group or of the 

Company to meet their obligations as and when they fall due. 

(III) AS AT THE DATE OF THIS REPORT 

(e) There are no charges on the assets of the Group and of the Company which have arisen since the end of the financial 

year to secure the liabilities of any other person. 

(f) There are no contingent liabilities of the Group and of the Company which have arisen since the end of the financial 

year. 

(g) The Directors are not aware of any circumstances not otherwise dealt with in the report or financial statements which 

would render any amount stated in the financial statements of the Group and of the Company misleading. 

SIGNIFICANT EVENTS DURING THE FINANCIAL YEAR 

(a) On 30 December 2009, the Company had submitted applications to the Companies Commission of Malaysia (‘CCM’) 

to strike off from CCM’s register its wholly-owned dormant subsidiaries, namely Gugusan Induk Sdn. Bhd. (‘GISB’), Insan 

Delima Sdn. Bhd. (‘IDSB’), JTOP Lebir Plantation Sdn. Bhd. (‘JTOP Lebir’) and Teon Choon Quarry Sdn. Bhd. (‘TCQSB’), 

under Section 308 of the Companies Act, 1965. 

During the current financial year, the Company received the following striking-off notices from the CCM pursuant to the 

application for the striking-off: 

(i) Notices for the striking-off of GISB and JTOP Lebir, both dated 27 July 2010; 

(ii) Notice for the striking-off of TCQSB, dated 16 August 2010; and 

(iii) Notice for the striking-off of IDSB, dated 9 September 2010. 

Accordingly, GISB and JTOP Lebir were struck-off from CCM’s register on 7 September 2010 and TCQSB and IDSB were 

struck-off from CCM’s register on 17 September 2010 and 13 October 2010 respectively. 


Annual Report 2010

SIGNIFICANT EVENTS DURING THE FINANCIAL YEAR (continued) 

(b) On 9 June 2010, the Company’s wholly-owned subsidiary, Johore Tenggara Oil Palm Berhad (‘JTOP’), acquired the 

remaining 60% equity interest in Hak JTOP Sdn. Bhd. (‘Hak JTOP’) for a cash consideration of RM3,200,000. Consequently, 

Hak JTOP became a wholly-owned subsidiary of JTOP. 

SIGNIFICANT EVENTS SUBSEQUENT TO THE END OF THE REPORTING PERIOD 


On 30 October 2009, Prisma Spektra Sdn. Bhd. (‘PSSB’), a wholly-owned subsidiary of the Company, entered into a conditional 

Share Sale Agreement (‘SSA’) with Semi Bayu Sdn. Bhd. (‘SBSB’) for the acquisition of 125,709,000 ordinary shares of RM1 

each in MARDEC Berhad (‘Mardec’), representing the entire issued and paid-up ordinary share capital of Mardec, for a total 

purchase consideration of RM150,000,000 (‘Proposed Acquisition of Mardec’). 

Mardec is an investment holding company incorporated in Malaysia and through its local and overseas subsidiaries and 

associates, is involved in the processing and trading of natural rubber and the manufacturing of value-added rubber and polymer 

products. 

The initial period for the fulfillment and satisfaction of the conditions precedent to the Proposed Acquisition of Mardec (‘Prescribed 

Period’) expired on 29 April 2010. On 30 April 2010, SBSB and PSSB agreed to extend the Prescribed Period by a further 

period of six months to 30 October 2010. On 1 November 2010, the Prescribed Period was extended by a further period of 

six months to 30 April 2011. 

On 25 February 2011, PSSB and SBSB entered into a supplemental agreement to revise the purchase consideration for the 

Proposed Acquisition of Mardec as provided in the SSA from RM150,000,000 to RM140,000,000, which shall be payable in 

the following manner: 

(i) a first instalment of RM42,000,000 or 30% of the revised purchase consideration to be paid on the completion date; and 

(ii) a second instalment of RM98,000,000 or 70% of the revised purchase consideration to be paid within 3 months of the 

completion date. 

The revised purchase consideration is arrived at based on Ernst & Young’s appraisal of the fair value of the Mardec Group by 

using the Hybrid Methodology, which is a combination of Income and Asset Approaches of valuation, which ranges between 

RM130,000,000 and RM150,000,000. 

The Proposed Acquisition of Mardec is pending the approvals of the shareholders of the Company at a general meeting to be 

convened and the Economic Planning Unit of the Prime Minister’s Department. 



95

HOLDING COMPANY 

The Directors regard Tradewinds (M) Berhad, a company incorporated in Malaysia and listed on the Main Market of Bursa 

Malaysia Securities Berhad, as the holding and ultimate holding company. 

Signed on behalf of the Board in accordance with a resolution of the Directors. 

DATO’ WIRA SYED ABDUL JABBAR BIN SYED HASSAN OOI TEIk HUAT 

Director Director 

Kuala Lumpur 

20 April 2011 

96 




Annual Report 2010

STATEMENT BY DIRECTORS 

In the opinion of the Directors, the financial statements set out on pages 100 to 218 have been drawn up in accordance with 

applicable approved Financial Reporting Standards and the provisions of the Companies Act, 1965 in Malaysia so as to give 

a true and fair view of the financial positions of the Group and of the Company as at 31 December 2010 and of the financial 

performance and cash flows of the Group and of the Company for the financial year then ended. 

On behalf of the Board, 

DATO’ WIRA SYED ABDUL JABBAR BIN SYED HASSAN OOI TEIk HUAT 

Director Director 

Kuala Lumpur 

20 April 2011 

STATUTORY DECLARATION 

I, Razidan bin Ghazalli, being the officer primarily responsible for the financial management of Tradewinds Plantation Berhad, 

do solemnly and sincerely declare that the financial statements set out on pages 100 to 218 are, to the best of my knowledge 

and belief, correct and I make this solemn declaration conscientiously believing the same to be true and by virtue of the provisions 

of the Statutory Declarations Act, 1960. 

Subscribed and solemnly declared by the abovenamed at 

Kuala Lumpur this 

20 April 2011 

Before me: 

Commissioner for Oaths 




97

INDEPENDENT AUDITORS’ REPORT 

TO THE MEMBERS OF TRADEWINDS PLANTATION BERHAD 

REPORT ON THE FINANCIAL STATEMENTS 

We have audited the financial statements of Tradewinds Plantation Berhad, which comprise the statements of financial positions 

as at 31 December 2010 of the Group and of the Company, and the statements of comprehensive income, statements of changes 

in equity and statements of cash flows of the Group and of the Company for the financial year then ended, and a summary of 

significant accounting policies and other explanatory information, as set out on pages 100 to 218. 

DIRECTORS’ RESPONSIBILITY FOR THE FINANCIAL STATEMENTS 

The Directors of the Company are responsible for the preparation of financial statements that give a true and fair view in 

accordance with Financial Reporting Standards and the Companies Act, 1965 in Malaysia, and for such internal control as the 

Directors determine are necessary to enable the preparation of financial statements that are free from material misstatement, 

whether due to fraud or error. 

AUDITORS’ RESPONSIBILITY 

Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in 

accordance with approved standards on auditing in Malaysia. Those standards require that we comply with ethical requirements 

and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material 

misstatement. 

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. 

The procedures selected depend on our judgment, including the assessment of risks of material misstatement of the financial 

statements, whether due to fraud or error. In making those risk assessments, we consider internal control relevant to the entity’s 

preparation of the financial statements that give a true and fair view in order to design audit procedures that are appropriate in 

the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. An audit 

also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made 

by the Directors, as well as evaluating the overall presentation of the financial statements. 

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion. 

OPINION 

98 


In our opinion, the financial statements have been properly drawn up in accordance with applicable approved Financial 

Reporting Standards and the provisions of the Companies Act, 1965 in Malaysia so as to give a true and fair view of the 

financial positions of the Group and of the Company as of 31 December 2010 and of their financial performance and cash 

flows for the financial year then ended. 


Annual Report 2010

REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS 

In accordance with the requirements of the Companies Act, 1965 in Malaysia, we also report the following: 

(a) In our opinion, the accounting and other records and the registers required by the Act to be kept by the Company and its 

subsidiaries of which we have acted as auditors have been properly kept in accordance with the provisions of the Act. 

(b) We have considered the financial statements and the auditors’ reports of all the subsidiaries of which we have not acted as 

auditors, which are indicated in Note 9 to the financial statements. 

(c) We are satisfied that the financial statements of the subsidiaries that have been consolidated with the Company’s financial 

statements are in form and content appropriate and proper for the purposes of the preparation of the financial statements 

of the Group and we have received satisfactory information and explanations required by us for those purposes. 

(d) The audit reports on the financial statements of the subsidiaries did not contain any qualification or any adverse comment 

made under Section 174(3) of the Act. 

OTHER REPORTING RESPONSIBILITIES 

The supplementary information set out in Note 19(c) to the financial statements is disclosed to meet the requirement of Bursa Malaysia 

Securities Berhad and is not part of the financial statements. The Directors are responsible for the preparation of the supplementary 

information in accordance with Guidance on Special Matter No. 1, Determination of Realised and Unrealised Profits or Losses in 

the Context of Disclosure Pursuant to Bursa Malaysia Securities Berhad Listing Requirements, as issued by the Malaysian Institute of 

Accountants (‘MIA Guidance’) and the directive of Bursa Malaysia Securities Berhad. In our opinion, the supplementary information 

is prepared, in all material respects, in accordance with the MIA Guidance and the directive of Bursa Malaysia Securities Berhad. 

OTHER MATTERS 

This report is made solely to the members of the Company, as a body, in accordance with Section 174 of the Companies Act, 

1965 in Malaysia and for no other purpose. We do not assume responsibility to any other person for the content of this report. 

BDO CHAN WAI LENG 

AF: 0206 2893/08/11 (J) 

Chartered Accountants Chartered Accountant 

Kuala Lumpur 

20 April 2011 




99

ASSETS 

Non-current assets 

100 



Group Company 

31.12.2010 31.12.2009 1.1.2009 31.12.2010 31.12.2009 

(Restated) (Restated) 

Note RM’000 RM’000 RM’000 RM’000 RM’000 

Property, plant and equipment 7 2,604,554 2,497,464 2,408,325 3,958 3,704 

Land held for property development 8 87,412 87,412 - - - 

Investments in subsidiaries 9 - - - 1,314,453 1,314,453 

Investment in an associate 10 - - 20,832 - - 

Investment in a jointly controlled entity 11 13,489 12,223 13,102 15,000 15,000 

Other investments 12 1,900 925 744 - - 

Goodwill on consolidation 13 25,554 25,554 25,554 - - 

Deferred tax assets 26 19,465 22,543 19,479 4,991 5,826 

Current assets 


STATEMENTS OF FINANCIAL POSITION 

AS AT 31 DECEMBER 2010 

2,752,374 2,646,121 2,488,036 1,338,402 1,338,983 

Inventories 14 43,271 60,611 74,823 - - 

Trade and other receivables 15 137,360 111,106 76,207 659,373 578,297 

Tax recoverable 3,829 6,560 6,977 3,733 3,723 

Cash and cash equivalents 16 78,345 63,739 66,266 66,395 51,506 

262,805 242,016 224,273 729,501 633,526 

Non-current assets held for sale 17 - 784 454 - - 

TOTAL ASSETS 3,015,179 2,888,921 2,712,763 2,067,903 1,972,509 

EQUITY AND LIABILITIES 

Equity attributable to owners of the parent 

Share capital 18 529,153 529,153 529,153 529,153 529,153 

Reserves 19 991,627 847,903 821,093 550,548 561,757 

1,520,780 1,377,056 1,350,246 1,079,701 1,090,910 

Minority interest 123,459 98,267 74,007 - - 

TOTAL EQUITY 1,644,239 1,475,323 1,424,253 1,079,701 1,090,910 

The accompanying notes form an integral part of the financial statements.

LIABILITIES 

Non-current liabilities 

Group Company 

31.12.2010 31.12.2009 1.1.2009 31.12.2010 31.12.2009 


Note RM’000 RM’000 RM’000 RM’000 RM’000 

Other payable 20 - - - 243,275 179,553 

Borrowings 21 500,800 527,357 484,521 17,230 20,783 

Deferred tax liabilities 26 324,711 322,101 293,617 - - 

Current liabilities 

825,511 849,458 778,138 260,505 200,336 

Trade and other payables 27 152,806 147,814 173,337 499,144 432,911 

Borrowings 21 372,765 413,564 332,374 228,553 248,352 

Current tax payable 19,858 2,762 4,661 - - 

545,429 564,140 510,372 727,697 681,263 

TOTAL LIABILITIES 1,370,940 1,413,598 1,288,510 988,202 881,599 

TOTAL EQUITY AND LIABILITIES 3,015,179 2,888,921 2,712,763 2,067,903 1,972,509 

The accompanying notes form an integral part of the financial statements. 




101

102 


STATEMENTS OF COMPREHENSIVE INCOME 

FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2010 



Group Company 

2010 2009 2010 2009 

(Restated) 

Note RM’000 RM’000 RM’000 RM’000 

Revenue 28 909,126 677,424 60,382 55,685 

Other operating income 17,170 8,351 31,043 29,908 

Changes in inventory of finished goods (8,619) (1,843) - - 

Raw materials and consumables used (237,632) (215,871) - - 

Staff costs 29 (124,394) (96,088) (11,239) (7,862) 

Depreciation of property, plant and equipment 7 (101,974) (94,060) (1,224) (1,248) 

Property development cost (1,463) - - - 

Impairment loss on investment in a subsidiary - - - (100) 

Other operating expenses (143,966) (164,633) (9,981) (5,961) 

308,248 113,280 68,981 70,422 

Excess of fair value of net assets 

acquired over purchase consideration 34 - 1,519 - - 

Share of result of a jointly controlled entity 1,266 (5,879) - - 

Finance costs (27,106) (30,573) (32,203) (29,796) 

Profit before tax 30 282,408 78,347 36,778 40,626 

Tax expense 31 (70,452) (23,953) (4,332) (3,852) 

Profit for the financial year 211,956 54,394 32,446 36,774 

Other comprehensive income: 

Exchange differences on translating foreign operations - 260 - - 

Realisation of exchange differences upon liquidation 

of an associate - (1,183) - - 

Fair value gains on available-for-sale financial assets 1,101 - - - 

Other comprehensive income for the year, net of tax 1,101 (923) - - 

Total comprehensive income for the year 213,057 53,471 32,446 36,774 


Group Company 

2010 2009 2010 2009 

(Restated) 

Note RM’000 RM’000 RM’000 RM’000 

Profit attributable to: 

Owners of the parent 186,404 51,545 32,446 36,774 

Minority interest 25,552 2,849 - - 

211,956 54,394 32,446 36,774 

Total comprehensive income attributable to: 

Owners of the parent 187,505 50,622 32,446 36,774 

Minority interest 25,552 2,849 - - 

Basic earnings per ordinary share 

attributable to owners of the parent (sen) 32 29.63 8.19 

213,057 53,471 32,446 36,774 

Dividend per ordinary share in respect 

of the financial year - gross (sen) 

- final (proposed) 33 5.00 6.00 5.00 6.00 

- interim (paid) 33 5.00 - 5.00 - 

Total 10.00 6.00 10.00 6.00 





103

104 


STATEMENTS OF CHANGES IN EQUITY 


Total 

Exchange Available- Equity attributable 

Share Share translation for-sale component Retained to owners of Minority Total 

Group capital premium reserve reserve of ICULS* earnings the parent interest equity 

RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 

As at 1 January 2009 529,153 316,155 923 - 133,657 370,358 1,350,246 74,007 1,424,253 

Total comprehensive 

income for the year - - (923) - - 51,545 50,622 2,849 53,471 

Transactions with owners: 

Arising from acquisition of 

a subsidiary (Note 34) - - - - - - - 21,786 21,786 

Dividend paid to minority 

interest of a subsidiary - - - - - - - (375) (375) 

Dividend paid (Note 33) - - - - - (23,812) (23,812) - (23,812) 

Total transactions with 

owners - - - - - (23,812) (23,812) 21,411 (2,401) 

As at 31 December 2009 529,153 316,155 - - 133,657 398,091 1,377,056 98,267 1,475,323 

As at 1 January 2010 529,153 316,155 - - 133,657 398,091 1,377,056 98,267 1,475,323 

Effect of adopting FRS 139 - - - (126) - - (126) - (126) 

Restated balance as at 

1 January 2010 529,153 316,155 - (126) 133,657 398,091 1,376,930 98,267 1,475,197 

Total comprehensive 

income for the year - - - 1,101 - 186,404 187,505 25,552 213,057 

Transactions with owners: 

Dividend paid to minority 

interest of a subsidiary - - - - - - - (360) (360) 

Dividend paid (Note 33) - - - - - (43,655) (43,655) - (43,655) 

Total transactions with 

owners - - - - - (43,655) (43,655) (360) (44,015) 

As at 31 December 2010 529,153 316,155 - 975 133,657 540,840 1,520,780 123,459 1,644,239 

* ICULS denotes Irredeemable Convertible Unsecured Loan Stocks 



Annual Report 2010

Equity 

Share Share component Retained Total 

Company capital premium of ICULS earnings equity 

RM’000 RM’000 RM’000 RM’000 RM’000 

As at 1 January 2009 529,153 316,155 133,657 98,983 1,077,948 

Total comprehensive income - - - 36,774 36,774 

Dividend paid (Note 33) - - - (23,812) (23,812) 

As at 31 December 2009 529,153 316,155 133,657 111,945 1,090,910 

As at 1 January 2010 529,153 316,155 133,657 111,945 1,090,910 

Total comprehensive income - - - 32,446 32,446 

Dividend paid (Note 33) - - - (43,655) (43,655) 

As at 31 December 2010 529,153 316,155 133,657 100,736 1,079,701 





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STATEMENTS OF CASH FLOWS 


CASH FLOWS FROM OPERATING ACTIVITIES 



Group Company 

2010 2009 2010 2009 

(Restated) 

Note RM’000 RM’000 RM’000 RM’000 

Profit before tax 282,408 78,347 36,778 40,626 

Adjustments for: 

Impairment loss on: 

- Investment in a subsidiary - - - 100 

- Other receivables - 90 - - 

Reversal of impairment loss on other investments - (181) - - 

Depreciation of property, plant and equipment 7 101,974 94,060 1,224 1,248 

Dividend income from subsidiaries - - (52,172) (46,088) 

Gain on liquidation of an associate - (1,183) - - 

Gain on disposal of property, plant and equipment (822) (136) (173) - 

Gain on disposal of non-current assets held for sale (716) (648) - - 

Finance costs 27,106 30,573 32,203 29,796 

Finance income (598) (441) (30,852) (29,891) 

Loss on disposal of property, plant and equipment - 2 - - 

Property, plant and equipment written off 875 177 806 - 

Excess of fair value of net assets acquired 

over purchase consideration 34 - (1,519) - - 

Share of result of a jointly controlled entity (1,266) 5,879 - - 

Operating profit/(loss) before working capital changes 408,961 205,020 (12,186) (4,209) 

Decrease in inventories 17,340 14,212 - - 

Increase in trade and other receivables (16,219) (35,721) (431) (285) 

Increase/(Decrease) in trade and other payables 5,249 (13,369) 4,768 (847) 

Cash generated from/(used in) operations 415,331 170,142 (7,849) (5,341) 

Tax refunded 3,488 2,602 3,004 - 

Tax paid (48,425) (26,400) (265) (437) 

Net cash from/(used in) operating activities 370,394 146,344 (5,110) (5,778) 


CASH FLOWS FROM INVESTING ACTIVITIES 

Group Company 

2010 2009 2010 2009 

(Restated) 

Note RM’000 RM’000 RM’000 RM’000 

Acquisition of subsidiaries, net of cash acquired 34 (3,200) (46,278) - (49,315) 

Advances to subsidiaries - - (72,765) (100,509) 

Decrease in deposits pledged to licensed banks 401 23 - - 

Proceeds from disposal of property, plant and equipment 2,286 267 442 - 

Purchase of property, plant and equipment 7 (194,421) (162,288) (2,553) (499) 

Finance income received 598 441 30,852 29,891 

Distribution arising from liquidation of an associate - 45 - - 

Proceeds from disposal of non-current assets held for sale 17 1,500 990 - - 

Subscription of redeemable convertible 

preference shares in a jointly controlled entity - (5,000) - (5,000) 

Dividend received from subsidiaries - - 45,926 45,508 

Net cash (used in)/from investing activities (192,836) (211,800) 1,902 (79,924) 





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STATEMENTS OF CASH FLOWS 


CASH FLOWS FROM FINANCING ACTIVITIES 



Group Company 

2010 2009 2010 2009 

(Restated) 

Note RM’000 RM’000 RM’000 RM’000 

Drawdown of term loans 15,350 160,400 - - 

Repayment of term loans (80,354) (55,712) - - 

Prepayment of term loan - (14,500) - - 

Net (repayment)/drawdown of revolving credits (24,000) 87,000 (20,000) 82,000 

Redemption of Sukuk Ijarah (25,000) - - - 

Net issuance/(redemption) of Murabahah 

Commercial Papers/Medium Term Notes 50,000 (50,000) - - 

Placement of deposits held on trust for 

the benefit of the Islamic Securities Investors (1,278) - - - 

Repayments (to)/from holding company (330) 93 (329) 93 

Advances from holding company - 741 - 740 

Advances from subsidiaries - - 125,619 - 

Advances to a subsidiary of a 

jointly controlled entity (10,631) (1,313) (10,549) (1,307) 

Repayments from subsidiaries - - 2,681 88,957 

Repayments to subsidiaries - - - (33,785) 

Repayments to a subsidiary of a jointly 

controlled entity (4) (10) - (11) 

Repayments (to)/from a related company (15) 351 (103) 345 

Advances (to)/from a related company (12) 144 (12) 103 

Repayments from/(Advances to) an associate 893 (292) - - 

Finance costs paid (44,433) (41,192) (35,555) (32,958) 

Dividend paid to minority shareholders in a 

subsidiary (360) (375) - - 

Dividend paid to ordinary shareholders of the 

Company (43,655) (23,812) (43,655) (23,812) 

Net cash (used in)/from financing activities (163,829) 61,523 18,097 80,365 

Net increase/(decrease) in cash and cash equivalents 13,729 (3,933) 14,889 (5,337) 

Cash and cash equivalents at beginning of financial year 56,337 60,270 51,506 56,843 

Cash and cash equivalents at end of financial year 16 70,066 56,337 66,395 51,506 


NOTES TO THE FINANCIAL STATEMENTS 


1. CORPORATE INFORMATION 

The Company is a public limited liability company, incorporated and domiciled in Malaysia, and is listed on the Main 

Market of Bursa Malaysia Securities Berhad. 

The registered office and principal place of business of the Company is located at Level 9, Menara HLA, No. 3, Jalan Kia 

Peng, 50450 Kuala Lumpur. 

The holding and ultimate holding company of the Company is Tradewinds (M) Berhad, a company incorporated in Malaysia 

and listed on the Main Market of Bursa Malaysia Securities Berhad. 

The financial statements are presented in Ringgit Malaysia (‘RM’), which is also the Company’s functional currency. All 

financial information presented in RM have been rounded to the nearest thousand, unless otherwise stated. 

The financial statements were authorised for issue in accordance with a resolution by the Board of Directors on 20 April 2011. 

2. PRINCIPAL ACTIVITIES 

The principal activities of the Company are investment holding and provision of management services to the subsidiaries. 

The principal activities of the subsidiaries are set out in Note 9 to the financial statements. 

There have been no significant changes in the nature of these activities during the financial year. 

3. BASIS OF PREPARATION 

The financial statements of the Group and of the Company have been prepared in accordance with applicable approved 

Financial Reporting Standards (‘FRSs’) and the provisions of the Companies Act, 1965 in Malaysia except that Note 19(c) to 

the financial statements has been prepared in accordance with Guidance on Special Matter No. 1, Determination of Realised 

and Unrealised Profits or Losses in the Context of Disclosures Pursuant to Bursa Malaysia Securities Berhad Listing Requirements, 

as issued by the Malaysian Institute of Accountants (‘MIA Guidance’) and the directive of Bursa Malaysia Securities Berhad. 

4. SIGNIFICANT ACCOUNTING POLICIES 

4.1 Basis of accounting 


The financial statements of the Group and of the Company have been prepared under the historical cost convention 

except as otherwise stated in the financial statements. 

The preparation of financial statements requires the Directors to make estimates and assumptions that affect the reported 

amounts of assets, liabilities, revenue and expenses and disclosure of contingent assets and contingent liabilities. In 

addition, the Directors are also required to exercise their judgment in the process of applying the accounting policies. 

The areas involving such judgments, estimates and assumptions are disclosed in Note 6 to the financial statements. 

Although these estimates and assumptions are based on the Directors’ best knowledge of events and actions, actual 

results could differ from those estimates. 



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4. SIGNIFICANT ACCOUNTING POLICIES (continued) 

4.2 Basis of consolidation 

The consolidated financial statements incorporate the financial statements of the Company and all its subsidiaries 

made up to the end of the financial year using the purchase method of accounting. 

Under the purchase method of accounting, the cost of a business combination is measured at the aggregate of fair 

values at the date of exchange, of assets given, liabilities incurred or assumed, and equity instruments issued plus any 

costs directly attributable to the business combination. 

At the acquisition date, the cost of a business combination is allocated to the identifiable assets acquired, liabilities 

assumed and contingent liabilities in the business combination which are measured initially at their fair values at the 

acquisition date. The excess of the cost of the business combination over the Group’s interest in the net fair value of 

the identifiable assets, liabilities and contingent liabilities is recognised as goodwill (see Note 4.8 to the financial 

statements on goodwill). If the cost of the business combination is less than the interest in the net fair value of the 

identifiable assets, liabilities and contingent liabilities, the Group will: 

(a) reassess the identification and measurement of the acquiree’s identifiable assets, liabilities and contingent 

liabilities and the measurement of the cost of the combination; and 

(b) recognise immediately in the consolidated statement of comprehensive income any excess remaining after that 

reassessment. 

Subsidiaries are consolidated from the acquisition date, which is the date on which the Group effectively obtains 

control, until the date on which the Group ceases to control the subsidiaries. Control exists when the Group has the 

power to govern the financial and operating policies of an entity so as to obtain benefits from its activities. In assessing 

control, the existence and effect of potential voting rights that are currently convertible or exercisable are taken into 

consideration. 

Intragroup balances, transactions and unrealised gains and losses on intragroup transactions are eliminated in full. 

Intragroup losses may indicate an impairment that requires recognition in the consolidated financial statements. 

If a subsidiary uses accounting policies other than those adopted in the consolidated financial statements for like 

transactions and events in similar circumstances, appropriate adjustments are made to its financial statements in 

preparing the consolidated financial statements. 

The gain or loss on disposal of a subsidiary, which is the difference between the net disposal proceeds and the Group’s 

share of its net assets as of the date of disposal including the carrying amount of goodwill and the cumulative amount 

of any exchange differences that relate to the subsidiary, is recognised in the consolidated statement of comprehensive 

income. 

Minority interest is that portion of the profit or loss and net assets of a subsidiary attributable to equity interests that are 

not owned, directly or indirectly through subsidiaries, by the Group. It is measured at the minority’s share of the fair 

value of the subsidiaries’ identifiable assets and liabilities at the acquisition date and the minority’s share of changes 

in the subsidiaries’ equity since that date. 


Annual Report 2010


4.2 Basis of consolidation (continued) 

Where losses applicable to the minority in a subsidiary exceed the minority’s interest in the equity of that subsidiary, 

the excess and any further losses applicable to the minority are allocated against the Group’s interest except to the 

extent that the minority has a binding obligation and is able to make additional investment to cover the losses. If the 

subsidiary subsequently reports profits, such profits are allocated to the Group’s interest until the minority’s share of 

losses previously absorbed by the Group has been recovered. 

Minority interest is presented in the consolidated statement of financial position within equity and is presented in the 

consolidated statement of changes in equity separately from equity attributable to owners of the Company. 

Minority interest in the results of the Group is presented in the consolidated statement of comprehensive income as an 

allocation of the total profit or loss for the financial year between minority interest and owners of the Company. 

Transactions with minority interests are treated as transactions with parties external to the Group. Disposals to minority 

interests result in gains and losses that are recorded in the statements of comprehensive income. 

4.3 Property, plant and equipment and depreciation 

All items of property, plant and equipment are initially measured at cost. Cost includes expenditure that is directly 

attributable to the acquisition of the asset. 

Subsequent costs are included in the asset’s carrying amount or recognised as a separate asset, as appropriate, only 

when the cost is incurred and it is probable that future economic benefits associated with the cost will flow to the Group 

and the cost of the asset can be measured reliably. The carrying amount of parts that are replaced is derecognised. 

The costs of the day-to-day servicing of property, plant and equipment are recognised in profit or loss as incurred. Cost 

also comprises the initial estimate of dismantling and removing the asset and restoring the site on which it is located 

for which the Group is obligated to incur when the asset is acquired, if applicable. 

Each part of an item of property, plant and equipment with a cost that is significant in relation to the total cost of the 

asset and which has a different useful life, is depreciated separately. 

After initial recognition, property, plant and equipment except for freehold land are stated at cost less accumulated 

depreciation and any accumulated impairment losses. 

Depreciation is calculated to write off the cost of the assets to their residual values on a straight line basis over their 

estimated useful lives. Leased assets are depreciated over the shorter of the lease term and their useful lives unless it is 

reasonably certain that the Group will obtain ownership by end of the lease term. The principal annual depreciation 

periods and rates are as follows: 

Buildings 2.5% - 10% 

Long term leasehold land 55 - 999 years 

Plant and machinery 5% - 20% 

Motor vehicles 20% 

Office equipment 10% - 33.33% 

Furniture and fittings 10% - 20% 

Access road 5% 




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4.3 Property, plant and equipment and depreciation (continued) 

Freehold land is not depreciated as it has an infinite life. Capital work-in-progress represents buildings, access roads 

under construction and machineries under installation and is stated at cost. Capital work-in-progress is not depreciated 

until such time when the asset is available for use. 

At the end of each reporting period, the carrying amount of an item of property, plant and equipment is assessed for 

impairment when events or changes in circumstances indicate that its carrying amount may not be recoverable. A 

write down is made if the carrying amount exceeds the recoverable amount (see Note 4.9 to the financial statements 

on impairment of non-financial assets). 

The residual values, useful lives and depreciation method are reviewed at each financial year end to ensure that 

the amount, method and period of depreciation are consistent with previous estimates and the expected pattern of 

consumption of the future economic benefits embodied in the items of property, plant and equipment. If expectations 

differ from previous estimates, the changes are accounted for as a change in an accounting estimate. The Group 

anticipates that the residual values of its property, plant and equipment will not be significant. 

The carrying amount of an item of property, plant and equipment is derecognised on disposal or when no future 

economic benefits are expected from its use or disposal. The difference between the net disposal proceeds, if any, and 

the carrying amount is included in profit or loss. 

4.4 Plantation development expenditure 

Mature plantations are stated at cost less accumulated amortisation and any accumulated impairment losses where the 

recoverable amount of the asset is estimated to be lower than its carrying amount. Amortisation is charged to profit or 

loss so as to write off the cost of mature plantations, using the straight-line method, over the estimated useful lives of 25 

years, representing the economic useful lives of the crops. 

Costs incurred in the preparation of the nursery, purchase of seedlings and their maintenance are stated at cost. The 

accumulated costs will be transferred to plantation development expenditure at the time of planting. 

Immature plantations are stated at cost. The costs of immature plantations consist mainly of the accumulated cost of 

land clearing, planting, fertilising and maintaining the plantation, borrowing costs and other indirect overhead costs 

up to the time the trees are harvestable and to the extent appropriate. 


Annual Report 2010


4.5 Property development activities 

(a) Land held for property development 

Land held for property development is stated at cost less accumulated impairment losses, if any. Such land is 

classified as non-current asset when no significant development work has been carried out or where development 

activities are not expected to be completed within the normal operating cycle. 

Cost associated with the acquisition of land includes the purchase price of the land, professional fees, stamp 

duties, commissions, conversion fees and other relevant levies. 

Land held for property development is reclassified as property development costs at the point when development 

activities have commenced and where it can be demonstrated that the development activities can be completed 

within the normal operating cycle. 

(b) Property development costs 


Property development costs comprise all cost that are directly attributable to the development activities or that 

can be allocated on a reasonable basis to such activities. They comprise the cost of land under development, 

construction costs and other related development costs common to the whole project including professional fees, 

stamp duties, commissions, conversion fees and other relevant levies as well as borrowing costs. 

Interest costs incurred on financing the development of the projects are capitalised and included as part of 

development expenditure. 

The Group considers as current assets that portion of property development expenditure on which significant 

development work has been done and which is expected to be completed within the normal operating cycle. 

Property development costs not recognised as an expense are recognised as an asset measured at the lower of 

cost and net realisable value. 

When revenue recognised in profit or loss exceeds progress billing to purchasers, the balance is classified as 

accrued billings under current assets. When progress billings exceed revenue recognised in profit or loss, the 

balance is classified as progress billings under current liabilities. 



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4.6 Leases 

4.6.1 Finance leases 

Assets acquired under finance leases and hire-purchase which transfer substantially all the risks and rewards 

of ownership to the Group are recognised initially at amounts equal to the fair value of the leased assets or, 

if lower, the present value of the minimum lease payments, each determined at the inception of the lease. The 

discount rate used in calculating the present value of the minimum lease payments is the interest rate implicit 

in the leases, if this is practicable to determine, if not, the Group’s incremental borrowing rate is used. Any 

initial direct costs incurred by the Group are added to the amount recognised as an asset. The assets are 

capitalised as property, plant and equipment and the corresponding obligations are treated as liabilities. The 

assets capitalised are depreciated on the same basis as owned assets. 

The minimum lease payments are apportioned between finance charges and a reduction of the outstanding 

liability. The finance charges are recognised in profit or loss over the period of the lease term so as to produce 

a constant periodic rate of interest on the remaining lease and hire purchase liabilities. 

4.6.2 Operating leases 

A lease is classified as an operating lease if it does not transfer substantially all the risks and rewards incidental 

to ownership. 

Lease payment under operating leases are recognised as an expense on a straight-line basis over the lease term. 

4.6.3 Leases of land and buildings 

For leases of land and buildings, the land and buildings elements are considered separately for the purpose of 

lease classification and these leases are classified as operating or finance leases in the same way as leases of 

other assets. 

The minimum lease payments including any lump-sum upfront payments made to acquire the interest in the land 

and buildings are allocated between the land and the buildings elements in proportion to the relative fair values 

of the leasehold interests in the land element and the buildings element of the lease at the inception of the lease. 

The buildings element is classified as a finance or operating lease in accordance with Note 4.6.1 or Note 

4.6.2 to the financial statements. If the lease payment cannot be allocated reliably between leasehold land 

and building, the entire lease is classified as a finance lease, unless it is clear that both elements are operating 

leases, in which case the entire lease is classified as an operating lease. 

For a lease of land and building in which the amount that would initially be recognised for the land element 

is immaterial, the land and building is treated as a single unit for the purpose of lease classification and is 

accordingly classified as a finance or operating lease. In such a case, the economic life of the building is 

regarded as the economic life of the entire leased asset. 

Following the adoption of Amendment to FRS 117 Leases contained in the Improvements to FRSs (2009), the 

Group had reassessed the classification of land elements of unexpired leases on the basis of information existing 

at the inception of those leases. Consequently, the Group retrospectively reclassified all prepaid lease payments 

for land as finance lease as disclosed in Notes 7 and 43 to the financial statements. 


Annual Report 2010


4.7 Investments 

(a) Subsidiaries 

A subsidiary is an entity in which the Group and the Company have power to control the financial and operating 

policies so as to obtain benefits from its activities. The existence and effect of potential voting rights that are 

currently exercisable or convertible are considered when assessing whether the Group has such power over 

another entity. 

An investment in subsidiary, which is eliminated on consolidation, is stated in the Company’s separate financial 

statements at cost less impairment losses, if any. On disposal of such an investment, the difference between the 

net disposal proceeds and its carrying amount is included in profit or loss. 

(b) Associates 


An associate is an entity over which the Group has significant influence and that is neither a subsidiary nor an 

interest in a joint venture. Significant influence is the power to participate in the financial and operating policy 

decisions of the investee but not control or joint control over those policies. 

In the Company’s separate financial statements, an investment in associate is stated at cost less impairment losses, 

if any. 

An investment in associate is accounted for in the consolidated financial statements using the equity method of 

accounting. The investment in associate in the consolidated statement of financial position is initially recognised 

at cost and adjusted thereafter for the post acquisition change in the Group’s share of net assets of the investment. 

The interest in the associate is the carrying amount of the investment in the associate under the equity method 

together with any long term interest that, in substance, forms part of the Group’s net investment in the associate. 

The Group’s share of the profit or loss of the associate during the financial year is included in the consolidated 

statement of comprehensive income, after adjustments to align the accounting policies with those of the Group, 

from the date that significant influence commences until the date that significant influence ceases. Distributions 

received from the associate reduce the carrying amount of the investment. Adjustments to the carrying amount 

may also be necessary for changes in the Group’s proportionate interest in the associate arising from changes in 

the associate’s equity that have not been recognised in the associate’s profit or loss. Such changes include those 

arising from the revaluation of property, plant and equipment and from foreign exchange translation differences. 

The Group’s share of those changes is recognised directly in equity of the Group. 

Unrealised gains and losses on transactions between the Group and the associate are eliminated to the extent of 

the Group’s interest in the associate; unrealised losses are eliminated unless the transaction provides evidence on 

the impairment of the asset transferred. 



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4.7 Investments (continued) 

(b) Associates (continued) 

When the Group’s share of losses in the associate equals or exceeds its interest in the associate, the carrying 

amount of that interest is reduced to nil and the Group does not recognise further losses unless it has incurred legal 

or constructive obligations or made payments on its behalf. 

The most recent available financial statements of the associate are used by the Group in applying the equity 

method. When the end of the reporting periods of the financial statements are not coterminous, the share of 

results is arrived at using the latest financial statements for which the difference in end of the reporting periods is 

no more than three (3) months. Adjustments are made for the effects of any significant transactions or events that 

occur between the intervening periods. 

Upon disposal of an investment in associate, the difference between the net disposal proceeds and its carrying 

amount is included in profit or loss. 

(c) Jointly controlled entities 

A jointly controlled entity is a joint venture that involves the establishment of a corporation, partnership or other 

entities over which there is contractually agreed sharing of joint control over the economic activity of the entity. 

Joint control exists when the strategic financial and operational decisions relating to the activity require the 

unanimous consent of all the parties sharing control. 

In the Company’s separate financial statements, an investment in jointly controlled entities is stated at cost less 

impairment losses, if any. 

The investment in jointly controlled entity is accounted for in the consolidated financial statements using the equity 

method of accounting. The Group’s share of the profit or loss of the jointly controlled entity during the financial 

year is included in the consolidated financial statements, after adjustments to align the accounting policies with 

those of the Group, from the date that joint control commences until the date that joint control ceases. 

The Group recognises the portion of gains or losses on the sale of assets by the Group to the joint venture that 

is attributable to the other venturers. The Group does not recognise its share of profits or losses from the joint 

venture that result from the purchase of assets by the Group from the joint venture until it resells the assets to an 

independent party. However, a loss on the transaction is recognised immediately if the loss provides evidence 

of a reduction in the net realisable value of current assets or an impairment loss. When necessary, in applying 

the equity method, adjustments are made to the financial statements of the jointly controlled entity to ensure 

consistency of accounting policies with those of the Group. 

Unrealised gains on transactions between the Group and its jointly controlled entity are eliminated to the extent 

of the Group’s interest in the jointly controlled entity; unrealised losses are also eliminated unless the transaction 

provides evidence on impairment of the asset transferred. 


Annual Report 2010


4.7 Investments (continued) 

(c) Jointly controlled entities (continued) 

4.8 Goodwill 

Adjustments to the carrying amount may also be necessary for changes in the Group’s proportionate interest 

in the jointly controlled entity arising from changes in the jointly controlled entity’s equity that have not been 

recognised in the jointly controlled entity’s profit or loss. Such changes include those arising from the revaluation 

of property, plant and equipment and from foreign exchange translation differences. The Group’s share of those 

changes is recognised directly in equity of the Group. 

Upon disposal of such an investment, the difference between the net disposal proceeds and its carrying amount 

is included in profit or loss. 

Goodwill acquired in a business combination is recognised as an asset at the acquisition date and is initially measured 

at cost being the excess of the cost of the business combination over the Group’s interest in the net fair value of the 

identifiable assets, liabilities and contingent liabilities. After initial recognition, goodwill is measured at cost less 

accumulated impairment losses, if any. Goodwill is not amortised but instead tested for impairment annually or more 

frequently if events or changes in circumstances indicate that the carrying amount may be impaired. Gains and losses 

on the disposal of an entity include the carrying amount of goodwill relating to the entity sold. 

Goodwill arising on acquisition of an associate is the excess of the cost of investment over the Group’s share of the 

net fair value of net assets of the associate’s identifiable assets, liabilities and contingent liabilities at the date of 

acquisition. 

Goodwill relating to the associate is included in the carrying amount of the investment and is not amortised. 

4.9 Impairment of non-financial assets 


The carrying amounts of assets, except for financial assets (excluding investments in subsidiaries, associates and 

jointly controlled entities), inventories, deferred tax assets and non-current assets (or disposal groups) held for sale, are 

reviewed at the end of each reporting period to determine whether there is any indication of impairment. If any such 

indication exists, the asset’s recoverable amount is estimated. 

Goodwill is tested annually for impairment or more frequently if events or changes in circumstances indicate that the 

goodwill might be impaired. 

The recoverable amount of an asset is estimated for an individual asset. Where it is not possible to estimate the 

recoverable amount of the individual asset, the impairment test is carried out on the cash generating unit (‘CGU’) to 

which the asset belongs. Goodwill acquired in a business combination is from the acquisition date, allocated to each 

of the Group’s CGU or groups of CGU that are expected to benefit from the synergies of the combination giving rise 

to the goodwill irrespective of whether other assets or liabilities of the acquiree are assigned to those units or groups 

of units. 



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4.9 Impairment of non-financial assets (continued) 

Following the adoption of FRS 8 Operating Segments as disclosed in Note 4.22 to the financial statements, the 

consequential amendment to FRS 136 Impairment of Assets is also mandatory for financial periods beginning on or 

after 1 July 2009. This amendment requires goodwill acquired in a business combination to be tested for impairment 

as part of the impairment testing of CGU to which it relates. The CGU to which goodwill is allocated shall represent 

the lowest level within the Group at which the goodwill is monitored for internal management purposes and not larger 

than an operating segment determined in accordance with FRS 8. 

The recoverable amount of an asset or CGU is the higher of its fair value less cost to sell and its value in use. 

In estimating value in use, the estimated future cash inflows and outflows to be derived from continuing use of the asset 

and from its ultimate disposal are discounted to their present value using a pre-tax discount rate that reflects current 

market assessments of the time value of money and the risks specific to the asset. An impairment loss is recognised 

in profit or loss when the carrying amount of the asset or the CGU, including the allocated goodwill, exceeds the 

recoverable amount of the asset or the CGU. The total impairment loss is allocated, first, to reduce the carrying amount 

of any goodwill allocated to the CGU and then to the other assets of the CGU on a pro-rata basis of the carrying 

amount of each asset in the CGU. The impairment loss is recognised in profit or loss immediately. 

An impairment loss on goodwill is not reversed in subsequent periods. An impairment loss for other assets is reversed 

if, and only if, there has been a change in the estimates used to determine the assets’ recoverable amount since the 

last impairment loss was recognised. 

An impairment loss is reversed only to the extent that the asset’s carrying amount does not exceed the carrying amount 

that would have been determined, net of depreciation or amortisation, if no impairment loss had been recognised. 

Such reversals are recognised as income immediately in profit or loss. 

4.10 Inventories 

Inventories are stated at the lower of cost and net realisable value with weighted average cost being the main basis 

for cost. 

Cost of inventories comprises the original cost of purchase plus the cost of bringing the inventories to their intended 

location and condition. The cost of oil palm products includes the cost of raw materials, direct labour, other direct costs 

and a proportion of production overheads based on normal operating capacity of the production facilities. 

Cost of consumables comprises all costs of purchase and cost of nursery includes the original cost of purchase, direct 

labour and other related overheads. 

Cost of livestock includes the original cost of purchase and other attributable costs in nurturing the cattle to their 

saleable condition. 

Net realisable value is the estimated selling price in the ordinary course of business, less the estimated costs of 

completion and the estimated costs necessary to make the sale. 


Annual Report 2010


4.11 Financial instruments 

A financial instrument is any contract that gives rise to a financial asset of one enterprise and a financial liability or 

equity instrument of another enterprise. 

A financial asset is any asset that is cash, an equity instrument of another enterprise, a contractual right to receive 

cash or another financial asset from another enterprise, or a contractual right to exchange financial assets or financial 

liabilities with another enterprise under conditions that are potentially favourable to the Group. 

A financial liability is any liability that is a contractual obligation to deliver cash or another financial asset to another 

enterprise, or a contractual obligation to exchange financial assets or financial liabilities with another enterprise under 

conditions that are potentially unfavourable to the Group. 

Financial instruments are recognised in the statement of financial position when the Group has become a party to the 

contractual provisions of the instrument. At initial recognition, a financial instrument is recognised at fair value plus, in 

the case of a financial instrument not at fair value through profit or loss, transaction costs that are directly attributable 

to the acquisition or issuance of the financial instrument. 

An embedded derivative is separated from the host contract and accounted for as a derivative if, and only if the 

economic characteristics and risks of the embedded derivative is not closely related to the economic characteristics and 

risks of the host contract, a separate instrument with the same terms as the embedded derivative meets the definition of 

a derivative, and the hybrid instrument is not measured at fair value through profit or loss. 

(a) Financial assets 

A financial asset is classified into the following four categories after initial recognition for the purpose of subsequent 

measurement: 

(i) Financial assets at fair value through profit or loss 


Financial assets at fair value through profit or loss comprise financial assets that are held for trading (i.e. 

financial assets acquired principally for the purpose of resale in the near term), derivatives (both, freestanding 

and embedded) and financial assets that were specifically designated into this classification upon initial 

recognition. 

Subsequent to initial recognition, financial assets classified as at fair value through profit or loss are measured 

at fair value. Any gains or losses arising from changes in the fair value of financial assets classified as at fair 

value through profit or loss are recognised in profit or loss. Net gains or losses on financial assets classified 

as at fair value through profit or loss exclude foreign exchange gains and losses, interest and dividend 

income. Such income is recognised separately in profit or loss as components of other income or other 

operating losses. 

However, derivatives that are linked to and must be settled by delivery of unquoted equity instruments that 

do not have a quoted market price in an active market are recognised at cost. 



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4.11 Financial instruments (continued) 

(a) Financial assets (continued) 

(ii) Held-to-maturity investments 

Financial assets classified as held-to-maturity comprise non-derivative financial assets with fixed or 

determinable payments and fixed maturity that the Group and the Company have the positive intention and 

ability to hold to maturity. 

Subsequent to initial recognition, financial assets classified as held-to-maturity are measured at amortised 

cost using the effective interest method. Gains or losses on financial assets classified as held-to-maturity 

are recognised in profit or loss when the financial assets are derecognised or impaired, and through the 

amortisation process. 

(iii) Loans and receivables 

Financial assets classified as loans and receivables comprise non-derivative financial assets with fixed or 

determinable payments that are not quoted in an active market. 

Subsequent to initial recognition, financial assets classified as loans and receivables are measured at 

amortised cost using the effective interest method. Gains or losses on financial assets classified as loans and 

receivables are recognised in profit or loss when the financial assets are derecognised or impaired, and 

through the amortisation process. 

(iv) Available-for-sale financial assets 

Financial assets classified as available-for-sale comprise non-derivative financial assets that are designated 

as available for sale or are not classified as loans and receivables, held-to-maturity investments or financial 

assets at fair value through profit or loss. 

Subsequent to initial recognition, financial assets classified as available-for-sale are measured at fair value. 

Any gains or losses arising from changes in the fair value of financial assets classified as available-for-sale 

are recognised directly in other comprehensive income, except for impairment losses and foreign exchange 

gains and losses, until the financial asset is derecognised, at which time the cumulative gains or losses 

previously recognised in other comprehensive income are recognised in profit or loss. However, interest 

calculated using the effective interest method is recognised in profit or loss whilst dividends on availablefor-sale 

equity instruments are recognised in profit or loss when the Group’s right to receive payment is 

established. 

Cash and cash equivalents include cash and bank balances, bank overdrafts, deposits and other short term, 

highly liquid investments with original maturities of three (3) months or less, which are readily convertible to cash 

and are subject to insignificant risk of changes in value. 


Annual Report 2010



(a) Financial assets (continued) 

A financial asset is derecognised when the contractual right to receive cash flows from the financial asset has 

expired. On derecognition of a financial asset in its entirety, the difference between the carrying amount and 

the sum of consideration received (including any new asset obtained less any new liability assumed) and any 

cumulative gain or loss that had been recognised directly in other comprehensive income shall be recognised in 

profit or loss. 

A regular way purchase or sale is a purchase or sale of a financial asset under a contract whose terms require 

delivery of the asset within the time frame established generally by regulation or marketplace convention. 

(b) Financial liabilities 

Financial instruments are classified as liabilities or equity in accordance with the substance of the contractual 

arrangement. A financial liability is classified into the following two categories after initial recognition for the 

purpose of subsequent measurement: 

(i) Financial liabilities at fair value through profit or loss 

Financial liabilities at fair value through profit or loss comprise financial liabilities that are held for trading, 

derivatives (both, freestanding and embedded) and financial liabilities that were specifically designated into 

this classification upon initial recognition. 

Subsequent to initial recognition, financial liabilities classified as fair value through profit or loss are 

measured at fair value. Any gains or losses arising from changes in the fair value of financial liabilities 

classified as fair value through profit or loss are recognised in profit or loss. Net gains or losses on financial 

liabilities classified as fair value through profit or loss exclude foreign exchange gains and losses, interest 

and dividend income. Such income is recognised separately in profit or loss as components of other income 

or other operating losses. 

(ii) Other financial liabilities 


Financial liabilities classified as other financial liabilities comprise non-derivative financial liabilities that are 

neither held for trading nor initially designated as fair value through profit or loss. 

Subsequent to initial recognition, other financial liabilities are measured at amortised cost using the effective 

interest method. Gains or losses on other financial liabilities are recognised in profit or loss when the 

financial liabilities are derecognised and through the amortisation process. 



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(b) Financial liabilities (continued) 

A financial liability is derecognised when, and only when, it is extinguished, i.e. when the obligation specified 

in the contract is discharged or cancelled or expires. An exchange between an existing borrower and lender 

of debt instruments with substantially different terms are accounted for as an extinguishment of the original 

financial liability and the recognition of a new financial liability. Similarly, a substantial modification of the terms 

of an existing financial liability is accounted for as an extinguishment of the original financial liability and the 

recognition of a new financial liability. 

The difference between the carrying amount of a financial liability extinguished or transferred to another party 

and the consideration paid, including any non-cash assets transferred or liabilities assumed, is recognised in 

profit or loss. 

A financial guarantee contract is a contract that requires the issuer to make specified payments to reimburse the 

holder for a loss it incurs because a specified debtor fails to make payment when due in accordance with the 

original or modified terms of a debt instrument. 

(c) Equity 

An equity instrument is any contract that evidences a residual interest in the assets of the Group and of the 

Company after deducting all of its liabilities. Ordinary shares are classified as equity instruments. 

Ordinary shares are recorded at the nominal value and proceeds in excess of the nominal value of shares issued, 

if any, are accounted for as share premium. Both ordinary shares and share premium are classified as equity. 

Transaction costs of an equity transaction are accounted for as a deduction from equity, net of any related income 

tax benefit. Otherwise, they are charged to profit or loss. 

Dividends to shareholders are recognised in equity in the period in which they are declared. 

If the Company reacquires its own equity instruments, the consideration paid, including any attributable transaction 

costs is deducted from equity as treasury shares until they are cancelled. No gain or loss is recognised in profit 

or loss on the purchase, sale, issue or cancellation of the Company’s own equity instruments. Where such shares 

are issued by resale, the difference between the sales consideration and the carrying amount is shown as a 

movement in equity. 


Annual Report 2010



(d) Irredeemable Convertible Unsecured Loan Stocks (‘ICULS’) 

The ICULS are regarded as compound instruments, consisting of a liability component and an equity component. 

At the date of issue, the fair value of the liability component is estimated based on the present value of the 

contractually determined stream of future cash flows discounted at the prevailing market interest rate applicable 

to similar instruments. The difference between the proceeds of the ICULS and the fair value assigned to the liability 

component is included in equity. 

The liability component is subsequently stated at amortised cost using the effective interest rate method until 

extinguished on conversion, whilst the value of the equity component is not adjusted in subsequent periods. The 

imputed interest is charged to profit or loss together with the effective tax effect and is added to the carrying value 

of the ICULS. 

Following the adoption of FRS 139 during the financial year, the Group reassessed the classification and measurement 

of financial assets and financial liabilities as at 1 January 2010. Consequently, the Group reclassified and remeasured 

financial assets and financial liabilities as disclosed in Note 44 to the financial statements. 

4.12 Impairment of financial assets 

The Group assesses whether there is any objective evidence that a financial asset is impaired at the end of each 

reporting period. 

(a) Loans and receivables 


The Group collectively considers factors such as the probability of bankruptcy or significant financial difficulties 

of the receivable or investee, and default or significant delay in payments to determine whether there is objective 

evidence that an impairment loss on loans and receivables has occurred. Other objective evidence of impairment 

include historical collection rates determined on an individual basis and observable changes in national or local 

economic conditions that are directly correlated with the historical default rates of receivables. 

If any such objective evidence exists, the amount of impairment loss is measured as the difference between the 

financial asset’s carrying amount and the present value of estimated future cash flows discounted at the financial 

asset’s original effective interest rate. The impairment loss is recognised in profit or loss. 

The carrying amount of loans and receivables are reduced through the use of an allowance account. 

If in a subsequent period, the amount of the impairment loss decreases and it objectively relates to an event 

occurring after the impairment was recognised, the previously recognised impairment loss is reversed to the 

extent that the carrying amount of the asset does not exceed its amortised cost at the reversal date. The amount 

of impairment reversed is recognised in profit or loss. 



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4.12 Impairment of financial assets (continued) 

(b) Available-for-sale financial assets 

The Group collectively considers factors such as significant or prolonged decline in fair value below cost, 

significant financial difficulties of the issuer or obligor, and the disappearance of an active trading market as 

objective evidence that available-for-sale financial assets are impaired. 

If any such objective evidence exists, an amount comprising the difference between the financial asset’s cost (net 

of any principal payment and amortisation) and current fair value, less any impairment loss previously recognised 

in profit or loss, is transferred from equity to profit or loss. 

Impairment losses on available-for-sale equity investments are not reversed in profit or loss in subsequent periods. 

Instead, any increase in the fair value subsequent to the impairment loss is recognised in other comprehensive 

income. 

4.13 Borrowing costs 

Borrowing costs that are directly attributable to the acquisition, construction or production of a qualifying asset are 

capitalised as part of the cost of the asset until when substantially all the activities necessary to prepare the asset for its 

intended use or sale are complete, after which such expense is charged to profit or loss. A qualifying asset is an asset 

that necessarily takes a substantial period of time to get ready for its intended use or sale. Capitalisation of borrowing 

costs is suspended during extended periods in which active development is interrupted. 

For plantation development expenditure, borrowing costs incurred on borrowings used to finance the development of 

plantation, less any investment income on temporary investment on these borrowings are capitalised until such time the 

trees are harvestable and to the extent appropriate. 

All other borrowing costs are recognised in profit or loss in the period in which they are incurred. 

4.14 Income taxes 

Income taxes include all domestic and foreign taxes on taxable profit. Income taxes also include other taxes, such as 

withholding taxes, which are payable by a foreign subsidiary or an associate on distributions to the Group and the 

Company, and real property gains taxes payable on disposal of properties. 

Taxes in statements of comprehensive income comprise current tax and deferred tax. 

(a) Current tax 

Current tax is the amount of income taxes payable or receivable in respect of the taxable profit or loss for a period. 

Current tax for the current and prior periods is measured at the amount expected to be recovered from or payable 

to the taxation authorities. The tax rates and tax laws used to compute the amount are those that have been 

enacted or substantively enacted by the end of the reporting period. 


Annual Report 2010


4.14 Income taxes (continued) 

(b) Deferred tax 

Deferred tax is recognised in full using the liability method on temporary differences arising between the carrying 

amount of an asset or liability in the statement of financial position and its tax base. 

Deferred tax is recognised for all temporary differences, unless the deferred tax arises from goodwill or the initial 

recognition of an asset or liability in a transaction which is not a business combination and at the time of transaction, 

affects neither accounting profit nor taxable profit. 

A deferred tax asset is recognised only to the extent that it is probable that taxable profit will be available 

against which the deductible temporary differences, unused tax losses and unused tax credits can be utilised. The 

carrying amount of a deferred tax asset is reviewed at the end of each reporting period. If it is no longer probable 

that sufficient taxable profit will be available to allow the benefit of part or all of that deferred tax asset to be 

realised, the carrying amount of the deferred tax asset will be reduced accordingly. When it becomes probable 

that sufficient taxable profit will be available, such reductions will be reversed to the extent of the taxable profit. 

Deferred tax assets and liabilities are offset when there is a legally enforceable right to set off current tax assets 

against current tax liabilities and when the deferred income taxes relate to the same taxation authority on either: 

(i) the same taxable entity; or 


(ii) different taxable entities which intend either to settle current tax liabilities and assets on a net basis, or to 

realise the assets and settle the liabilities simultaneously, in each future period in which significant amounts 

of deferred tax liabilities or assets are expected to be settled or recovered. 

Deferred tax will be recognised as income or expense and included in profit or loss for the period unless the tax 

relates to items that are credited or charged, in the same or a different period, directly to equity, in which case 

the deferred tax will be charged or credited directly to equity. 

Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the year when the 

asset is realised or the liability is settled, based on tax rates and tax laws that have been enacted or substantively 

enacted by the end of the reporting period. 



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4.15 Provisions 

Provisions are recognised when there is a present obligation, legal or constructive, as a result of a past event and when 

it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a 

reliable estimate can be made of the amount of the obligation. 

Where the effect of the time value of money is material, the amount of a provision will be discounted to its present value 

at a pre-tax rate that reflects current market assessments of the time value of money and the risks specific to the liability. 

Provisions are reviewed at the end of each reporting period and adjusted to reflect the current best estimate. If it is no 

longer probable that an outflow of resources embodying economic benefits will be required to settle the obligation, 

the provision will be reversed. 

Provisions are not recognised for future operating losses. If the Group has a contract that is onerous, the present 

obligation under the contract shall be recognised and measured as a provision. 

4.16 Contingent liabilities and contingent assets 

A contingent liability is a possible obligation that arises from past events whose existence will be confirmed by the 

occurrence or non-occurrence of one or more uncertain future events beyond the control of the Group or a present 

obligation that is not recognised because it is not probable that an outflow of resources will be required to settle 

the obligation. A contingent liability also arises in extremely rare cases where there is a liability that cannot be 

recognised because it cannot be measured reliably. The Group does not recognise this contingent liability but discloses 

its existence in the financial statements. 

A contingent asset is a possible asset that arises from past events whose existence will be confirmed by the occurrence or 

non-occurrence of one or more uncertain future events beyond the control of the Group. The Group does not recognise a 

contingent asset but discloses its existence where the inflows of economic benefits are probable, but not virtually certain. 

In the acquisition of subsidiaries by the Group under business combinations, contingent liabilities assumed are 

measured initially at their fair value at the acquisition date, irrespective of the extent of any minority interest. 

4.17 Employee benefits 

4.17.1 Short term employee benefits 

Wages, salaries, social security contributions, paid annual leave, paid sick leave, bonuses and non-monetary 

benefits are recognised as an expense in the financial year when employees have rendered their services to 

the Group. 

Short term accumulating compensated absences such as paid annual leave are recognised as an expense 

when employees render services that increase their entitlement to future compensated absences. Short term 

non-accumulating compensated absences such as sick leave are recognised when the absences occur. 

Bonuses are recognised as an expense when there is a present, legal or constructive obligation to make such 

payments, as a result of past events and when a reliable estimate can be made of the amount of the obligation. 


Annual Report 2010


4.17 Employee benefits (continued) 

4.17.2 Defined contribution plans 

4.18 Foreign Currencies 

The Group’s contributions to defined contribution plans are charged to profit or loss in the period to which they 

relate. Once the contributions have been paid, the Group has no further payment obligations. 

4.18.1 Functional and presentation currency 

Items included in the financial statements of each of the Group’s entities are measured using the currency of the 

primary economic environment in which the entity operates (‘the functional currency’). The consolidated financial 

statements are presented in Ringgit Malaysia, which is the Company’s functional and presentation currency. 

4.18.2 Foreign currency translations and balances 

Transactions in foreign currencies are converted into the functional currency of each company in the Group at 

rates of exchange ruling at the transaction dates. Monetary assets and liabilities in foreign currencies at the 

end of the reporting period are translated into their functional currencies at rates of exchange ruling at that 

date unless hedged by forward foreign exchange contracts, in which case the rates specified in such forward 

contracts are used. All exchange differences arising from the settlement of foreign currency transactions and 

from the translation of foreign currency monetary assets and liabilities are included in profit or loss in the 

period in which they arise. Non-monetary items initially denominated in foreign currencies, which are carried 

at historical cost are translated using the historical rate as of the date of acquisition, and non-monetary items 

which are carried at fair value are translated using the exchange rate that existed when the values were 

determined for presentation currency purposes. 

4.18.3 Foreign operations 


Financial statements of foreign operations are translated at financial year end exchange rates with respect to 

their assets and liabilities, and at exchange rates at the dates of the transactions with respect to profit or loss. 

All resulting translation differences are recognised as a separate component of equity. 

In the consolidated financial statements, exchange differences arising from the translation of net investment in 

foreign operations are taken to equity. When a foreign operation is partially disposed off or sold, exchange 

differences that were recorded in equity are recognised in profit or loss as part of the gain or loss on disposal. 

Exchange differences arising on a monetary item that forms part of the net investment of the Company in a 

foreign operation shall be recognised in profit or loss in the separate financial statements of the Company or 

the foreign operation, as appropriate. In the consolidated financial statements, such exchange differences 

shall be recognised initially as a separate component of equity and recognised in profit or loss upon disposal 

of the net investment. 

Goodwill and fair value adjustments to the assets and liabilities arising from the acquisition of a foreign 

operation are treated as assets and liabilities of the acquired entity and translated at the exchange rate ruling 

at the end of the reporting period. 



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4.19 Revenue recognition 

Revenue is measured at the fair value of the consideration received or receivable net of discounts and rebates. 

Revenue is recognised to the extent that it is probable that the economic benefits associated with the transaction will 

flow to the Group, and the amount of revenue and the cost incurred or to be incurred in respect of the transaction can 

be reliably measured and specific recognition criteria have been met for each of the Group’s activities as follows: 

(a) Sale of goods 

Revenue from sale of goods is recognised when the significant risks and rewards of ownership of the goods have 

been transferred to the customer and where the Group retains no continuing managerial involvement over the 

goods, which coincides with delivery of goods and acceptance by customers. 

(b) Property development 

Property development revenue is recognised in respect of all development units that have been sold. Revenue 

recognition commences when the sale of the development unit is effected, upon the commencement of development 

and construction activities and when the financial outcome can be reliably estimated. The attributable portion of 

property development cost is recognised as an expense in the period in which the related revenue is recognised. 

The amount of such revenue and expenses recognised is determined by reference to the percentage of completion 

of development activity at the end of the reporting period. The percentage of completion is measured by reference 

to the cost incurred to date compared to the total estimated cost of development. 

When the financial outcome of a development activity cannot be reliably estimated, the property development 

revenue is recognised only to the extent of property development costs incurred that is probable to be recoverable 

and the property development costs on the development units sold are recognised as an expense in the period in 

which they are incurred. 

Any expected loss on a development project is recognised as an expense immediately, including costs to be 

incurred over the defects liability period. 

(c) Services 

Revenue from rendering of management services is recognised in profit or loss upon performance of services. 

(d) Dividend income 

Dividend income is recognised when the right to receive payment is established. 

(e) Finance income 

Finance income is recognised as it accrues, using the effective interest method. 

(f) Rental income 

Rental income is recognised on a straight-line basis over the term of an ongoing lease. 


Annual Report 2010


4.20 Earnings per share 

The Group presents basic earnings per share (‘EPS’) data for its ordinary shares. Basic EPS is calculated by dividing 

the profit or loss attributable to ordinary shareholders of the Company by the weighted average number of ordinary 

shares outstanding during the period and ordinary shares that will be issued upon the conversion of mandatorily 

convertible instruments from the date the contract is entered into. 

4.21 Non-current assets (or disposal groups) held for sale 

Non-current assets (or disposal groups) are classified as held for sale if their carrying amounts will be recovered 

principally through a sale transaction rather than through continuing use. For this to be the case, the assets (or disposal 

groups) must be available for immediate sale in their present condition subject only to terms that are usual and 

customary for sales of such assets (or disposal groups) and their sale must be highly probable. 

The sale is expected to qualify for recognition as a completed sale within one (1) year from the date of classification. 

However, an extension of the period required to complete the sale does not preclude the assets (or disposal groups) 

from being classified as held for sale if the delay is caused by events or circumstances beyond the control of the Group 

and there is sufficient evidence that the Group remains committed to its plan to sell the assets (or disposal groups). 

Immediately before the initial classification as held for sale, the carrying amounts of the non-current assets (or all the 

assets and liabilities in a disposal group) are measured in accordance with applicable FRSs. On initial classification 

as held for sale, non-current assets or disposal groups (other than investment properties, deferred tax assets, employee 

benefits assets and financial assets carried at fair value) are measured at the lower of carrying amount before the 

initial classification as held for sale and fair value less costs to sell. The differences, if any, are recognised in profit or 

loss as impairment loss. 

Non-current assets (or disposal groups) held for sale are classified as current assets (and current liabilities, in the 

case of non-current liabilities included within disposal groups) in the statement of financial position and are stated 

at the lower of carrying amount immediately before initial classification and fair value less costs to sell and are not 

depreciated. Any cumulative income or expense recognised directly in equity relating to the non-current asset (or 

disposal group) classified as held for sale is presented separately. 

If the Group has classified an asset (or disposal group) as held for sale but subsequently the criteria for classification 

is no longer met, the Group ceases to classify the asset (or disposal group) as held for sale. The Group measures a 

non-current asset that ceases to be classified as held for sale (or ceases to be included in a disposal group classified 

as held for sale) at the lower of: 

(a) its carrying amount before the asset (or disposal group) was classified as held for sale, adjusted for any 

depreciation, amortisation or revaluations that would have been recognised had the asset (or disposal group) not 

been classified as held for sale; and 

(b) its recoverable amount at the date of the subsequent decision not to sell. 




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4.22 Operating segments 

Following the adoption of FRS 8 Operating Segments during the current financial year, operating segments are defined 

as components of the Group that: 

(a) engages in business activities from which it may earn revenues and incur expenses (including revenues and 

expenses relating to transactions with other components of the Group); 

(b) whose operating results are regularly reviewed by the Group’s chief operating decision maker in making decisions 

about resources to be allocated to the segment and assessing its performance; and 

(c) for which discrete financial information is available. 

An operating segment may engage in business activities for which it has yet to earn revenues. 

The Group reports separately information about each operating segment that meets any of the following quantitative 

thresholds: 

(i) Its reported revenue, including both sales to external customers and intersegment sales or transfers, is ten (10) 

percent or more of the combined revenue, internal and external, of all operating segments. 

(ii) The absolute amount of its reported profit or loss is ten (10) percent or more of the greater, in absolute amount of: 

(i) the combined reported profit of all operating segments that did not report a loss; and 

(ii) the combined reported loss of all operating segments that reported a loss. 

(iii) Its assets are ten (10) percent or more of the combined assets of all operating segments. 

Operating segments that do not meet any of the quantitative thresholds may be considered reportable, and separately 

disclosed, if the management believes that information about the segment would be useful to users of the financial 

statements. 

Total external revenue reported by operating segments shall constitute at least seventy five (75) percent of the Group’s 

revenue. Operating segments identified as reportable segments in the current financial year in accordance with the 

quantitative thresholds would result in a restatement of prior period segment data for comparative purposes. 


Annual Report 2010

5. ADOPTION OF NEW FRSs AND AMENDMENTS TO FRSs 

5.1 New FRSs adopted during the current financial year 

(a) FRS 8 and the consequential amendments resulting from FRS 8 are mandatory for annual financial periods 

beginning on or after 1 July 2009. 

FRS 8 sets out the requirements for the disclosure of information on the Group’s operating segments, products and 

services, the geographical areas in which it operates and its customers. 

The requirements of this Standard are based on the information about the components of the Group that 

management uses to make decisions about operating matters. This Standard requires the identification of 

operating segments on the basis of internal reports that are regularly reviewed by the Group’s chief operating 

decision maker in order to allocate resources to the segment and assess its performance, as elaborated in Note 

4.22 to the financial statements. 

In accordance with the transitional provisions of FRS 8, segment information for prior years that is reported as 

comparative information for the initial year of application has been restated to conform to requirements of FRS 8, 

as disclosed in Note 35 to the financial statements. 

The adoption of this Standard will only impact the form and content of disclosures and presentation of the Group’s 

financial statements. 

(b) FRS 4 Insurance Contracts and the consequential amendments resulting from FRS 4 are mandatory for annual 

financial periods beginning on or after 1 January 2010. FRS 4 replaces the existing FRS 202 2004 General 

Insurance Business and FRS 203 2004 Life Insurance Business. 

This Standard applies to all insurance contracts, including reinsurance contracts that an entity issues and to 

reinsurance contracts that it holds. This Standard prohibits provisions for potential claims under contracts that are 

not in existence at the end of the reporting period, and requires a test for the adequacy of recognised insurance 

liabilities and an impairment test for reinsurance assets. This Standard also requires an insurer to keep insurance 

liabilities in its statement of financial position until they are discharged or cancelled, or expire, and to present 

insurance liabilities without offsetting them against related reinsurance assets. 

There is no impact upon adoption of this Standard during the financial year. 


(c) FRS 7 Financial Instruments: Disclosures and the consequential amendments resulting from FRS 7 are mandatory 

for annual financial periods beginning on or after 1 January 2010. FRS 7 replaces the disclosure requirements of 

the existing FRS 132 Financial Instruments: Disclosure and Presentation. 

This Standard applies to all risks arising from a wide array of financial instruments and requires the disclosure of 

the significance of financial instruments for the Group’s financial position and performance. 

The adoption of this Standard will only impact the form and content of disclosures and presentation of the Group’s 

financial statements. 



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5. ADOPTION OF NEW FRSs AND AMENDMENTS TO FRSs (continued) 

5.1 New FRSs adopted during the current financial year (continued) 

(d) FRS 123 Borrowing Costs and the consequential amendments resulting from FRS 123 are mandatory for annual 

periods beginning on or after 1 January 2010. 

This Standard removes the option of immediately recognising as an expense borrowing costs that are directly 

attributable to the acquisition, construction or production of a qualifying asset. However, capitalisation of 

borrowing costs is not required for assets measured at fair value, and inventories that are manufactured or 

produced in large quantities on a repetitive basis, even if they take a substantial period of time to get ready for 

use or sale. 

There is no impact upon adoption of this Standard during the financial year. 

(e) FRS 139 Financial Instruments: Recognition and Measurement and the consequential amendments resulting from 

FRS 139 are mandatory for annual financial periods beginning on or after 1 January 2010. 

This Standard establishes the principles for the recognition and measurement of financial assets and financial 

liabilities including circumstances under which hedge accounting is permitted. 

The impact upon adoption of this Standard is disclosed in Note 44 to the financial statements. 

(f) Amendments to FRS 2 Share-based Payment: Vesting Conditions and Cancellations are mandatory for annual 

financial periods beginning on or after 1 January 2010. 

These amendments clarify that vesting conditions comprise service conditions and performance conditions only. 

Cancellations by parties other than the Group are accounted for in the same manner as cancellations by the 

Group itself and features of a share-based payment that are non-vesting conditions are included in the grant date 

fair value of the share-based payment. 

There is no impact upon adoption of these amendments during the financial year. 

(g) Amendments to FRS 1 First-time Adoption of Financial Reporting Standards and FRS 127 Consolidated and 

Separate Financial Statements: Cost of an Investment in a Subsidiary, Jointly Controlled Entity or Associate is 

mandatory for annual periods beginning on or after 1 January 2010. 

These amendments allow first-time adopters to use a deemed cost of either fair value or the carrying amount under 

previous accounting practice to measure the initial cost of investments in subsidiaries, jointly controlled entities 

and associates in the separate financial statements. The cost method of accounting for an investment has also 

been removed pursuant to these amendments. 



Annual Report 2010



(h) IC Interpretation 9 Reassessment of Embedded Derivatives is mandatory for annual financial periods beginning 

on or after 1 January 2010. 

This Interpretation prohibits the subsequent reassessment of embedded derivatives unless there is a change in the 

terms of the host contract that significantly modifies the cash flows that would otherwise be required by the host 

contract. 

There is no impact upon adoption of this Interpretation during the financial year. 

(i) IC Interpretation 10 Interim Financial Reporting and Impairment is mandatory for annual financial periods 

beginning on or after 1 January 2010. 

This Interpretation prohibits the reversal of an impairment loss recognised in a previous interim period in respect 

of goodwill or an investment in either an equity instrument or a financial asset carried at cost. 


(j) IC Interpretation 11 FRS 2 – Group and Treasury Share Transactions is mandatory for annual periods beginning 


This Interpretation requires share-based payment transactions in which the Company receives services from 

employees as consideration for its own equity instruments to be accounted for as equity-settled, regardless of the 

manner of satisfying the obligations to the employees. 

If the Company grants rights to its equity instruments to the employees of its subsidiaries, this Interpretation requires 

the Company to recognise the equity reserve for the obligation to deliver the equity instruments when needed 

whilst the subsidiaries shall recognise the remuneration expense for the services received from employees. 

If the subsidiaries grant rights to equity instruments of the Company to its employees, this Interpretation requires 

the Company to account for the transaction as cash-settled, regardless of the manner the subsidiaries obtain the 

equity instruments to satisfy its obligations. 



The Group would like to draw attention to the withdrawal of this Interpretation for annual periods beginning on 

or after 1 January 2011 as disclosed in Note 5.2(l) to the financial statements. 



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(k) IC Interpretation 13 Customer Loyalty Programmes is mandatory for annual periods beginning on or after 1 

January 2010. 

This Interpretation requires the separation of award credits as a separately identifiable component of sales 

transactions involving the award of free or discounted goods or services in the future. The fair value of the 

consideration received or receivable from the initial sale shall be allocated between the award credits and the 

other components of the sale. 

If the Group supplies the awards itself, the consideration allocated to the award credits shall only be recognised 

as revenue when the award credits are redeemed. If a third party supplies the awards, the Group shall assess 

whether it is acting as a principal or agent in the transaction. 

If the Group is acting as the principal in the transaction, it shall measure its revenue as the gross consideration 

allocated to the award credits. If the Group is acting as an agent, it shall measure its revenue as the net amount 

retained on its own account, and recognise the net amount as revenue when the third party becomes obliged to 

supply the awards and entitled to receive the consideration for doing so. 


(l) IC Interpretation 14 FRS 119 – The Limit on a Defined Benefit Asset, Minimum Funding Requirements and their 

Interaction is mandatory for annual periods beginning on or after 1 January 2010. 

This Interpretation applies to all post-employment defined benefits and other long-term employee defined benefits. 

This Interpretation clarifies that an economic benefit is available if the Group can realise it at some point during 

the life of the plan or when the plan liabilities are settled, and that it does not depend on how the Group intends 

to use the surplus. 

A right to refund is available to the Group in stipulated circumstances and the economic benefit available shall 

be measured as the amount of the surplus at the end of the reporting period less any associated costs. If there are 

no minimum funding requirements, the economic benefit available shall be determined as a reduction in future 

contributions as the lower of the surplus in the plan and the present value of the future service cost to the Group. 

If there is a minimum funding requirement for contributions relating to the future accrual of benefits, the economic 

benefit available shall be determined as a reduction in future contributions at the present value of the estimated 

future service cost less the estimated minimum funding required in each financial year. 



Annual Report 2010



(m) FRS 101 Presentation of Financial Statements is mandatory for annual periods beginning on or after 1 January 

2010. 

FRS 101 sets out the overall requirements for the presentation of financial statements, guidelines for their structure 

and minimum requirements for their content. 

This Standard introduces the titles ‘statement of financial position’ and ‘statement of cash flows’ to replace the 

current titles ‘balance sheet’ and ‘cash flow statement’ respectively. A new statement known as the ‘statement of 

comprehensive income’ is also introduced in this Standard whereby all non-owner changes in equity are required 

to be presented in either one statement of comprehensive income or in two statements (i.e. a separate income 

statement and a statement of comprehensive income). Components of comprehensive income are not permitted to 

be presented in the statement of changes in equity. 

This Standard also introduces a new requirement to present a statement of financial position as at the beginning 

of the earliest comparative period if there are applications of retrospective restatements that are defined in FRS 

108, or when there are reclassifications of items in the financial statements. 

Additionally, FRS 101 requires the disclosure of reclassification adjustments and income tax relating to each component 

of other comprehensive income, and the presentation of dividends recognised as distributions to owners together with 

the related amounts per share in the statement of changes in equity or in the notes to the financial statements. 

This Standard introduces a new requirement to disclose information on the objectives, policies and processes for 

managing capital based on information provided internally to key management personnel as defined in FRS 124 

Related Party Disclosures. Additional disclosures are also required for puttable financial instruments classified as 

equity instruments. 

Following the adoption of this Standard, the Group has reflected the new format of presentation and additional 

disclosures warranted in the primary financial statements and relevant notes to the financial statements. 

(n) Amendments to FRS 139, FRS 7 and IC Interpretation 9 are mandatory for annual periods beginning on or after 

1 January 2010. 

These amendments permit reclassifications of non-derivative financial assets (other than those designated at fair 

value through profit or loss upon initial recognition) out of the fair value through profit or loss category in rare 

circumstances. Reclassifications from the available-for-sale category to the loans and receivables category are 

also permitted provided there is intention and ability to hold that financial asset for the foreseeable future. All of 

these reclassifications shall be subjected to subsequent reassessments of embedded derivatives. 

These amendments also clarifies the designation of one-sided risk in eligible hedged items and streamlines the 

terms used throughout the Standards in accordance with the changes resulting from FRS 101. 





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(o) Amendments to FRS 132 Financial Instruments: Presentation is mandatory for annual periods beginning on or 

after 1 January 2010. 

These amendments require certain puttable financial instruments, and financial instruments that impose an 

obligation to deliver to counterparties a pro rata share of the net assets of the entity only on liquidation to be 

classified as equity. 

Puttable financial instruments are defined as financial instruments that give the holder the right to put the instrument 

back to the issuer for cash, or another financial asset, or are automatically put back to the issuer upon occurrence 

of an uncertain future event or the death or retirement of the instrument holder. 


(p) Improvements to FRSs (2009) are mandatory for annual periods beginning on or after 1 January 2010. 

Amendment to FRS 5 Non-current Assets Held for Sale and Discontinued Operations clarifies that the disclosure 

requirements of this Standard specifically apply to non-current assets (or disposal groups) classified as held for 

sale or discontinued operations. There is no impact upon adoption of this amendment during the financial year. 

Amendment to FRS 8 clarifies the consistency of disclosure requirement for information about profit or loss, assets 

and liabilities. There is no impact upon adoption of this amendment during the financial year. 

Amendment to FRS 107 Statement of Cash Flows clarifies the classification of cash flows arising from operating 

activities and investing activities. Cash payments to manufacture or acquire assets held for rental to others and 

subsequently held for sale, and the related cash receipts, shall be classified as cash flows from operating activities. 

Expenditures that result in a recognised asset in the statement of financial position are eligible for classification as 

cash flows from investing activities. There is no impact upon adoption of this amendment during the financial year. 

Amendment to FRS 108 Accounting Policies, Changes in Accounting Estimates and Errors clarifies that only 

Implementation Guidance issued by the MASB that are integral parts of FRSs is mandatory. There is no impact 

upon adoption of this amendment during the financial year. 

Amendment to FRS 110 Events after the Reporting Period clarifies the rationale for not recognising dividends 

declared after the reporting period but before the financial statements are authorised for issue. There is no impact 


Amendment to FRS 116 Property, Plant and Equipment removes the definition pertaining the applicability of this 

Standard to property that is being constructed or developed for future use as investment property but do not yet 

satisfy the definition of ‘investment property’ in FRS 140 Investment Property. This amendment also replaces the 

term ‘net selling price’ with ‘fair value less costs to sell’, and clarifies that proceeds arising from routine sale of 

items of property, plant and equipment shall be recognised as revenue in accordance with FRS 118 Revenue 

rather than FRS 5. There is no impact upon adoption of this amendment during the financial year. 


Annual Report 2010




(p) Improvements to FRSs (2009) are mandatory for annual periods beginning on or after 1 January 2010. (continued) 

Amendment to FRS 117 Leases removes the classification of leases of land and of buildings, and instead, requires 

assessment of classification based on the risks and rewards of the lease itself. The reassessment of land elements 

of unexpired leases shall be made retrospectively in accordance with FRS 108. As at the end of the reporting 

period, the Group has carrying amount of prepaid lease payments for land of RM1,114,243,000 (see Notes 

7 and 43 to the financial statements) that has been reclassified as land held in accordance with FRS 116 upon 

adoption of this amendment. 

Amendment to FRS 118 clarifies reference made on the term ‘transaction costs’ to the definition in FRS 139. There 

is no impact upon adoption of this amendment during the financial year. 

Amendment to FRS 119 Employee Benefits clarifies the definitions in this Standard by consistently applying 

settlement dates within twelve (12) months in the distinction between short-term employee benefits and other longterm 

employee benefits. This amendment also provides additional explanations on negative past service cost and 

curtailments. There is no impact upon adoption of this amendment during the financial year. 

Amendment to FRS 120 Accounting for Government Grants and Disclosure of Government Assistance streamlines 

the terms used in this Standard in accordance with the new terms used in FRS 101. There is no impact upon 

adoption of this amendment during the financial year. 

Amendment to FRS 123 clarifies that interest expense calculated using the effective interest rate method described 

in FRS 139 qualifies for recognition as borrowing costs. There is no impact upon adoption of this amendment 


Amendment to FRS 127 Consolidated and Separate Financial Statements clarifies that investments measured at 

cost shall be accounted for in accordance with FRS 5 when they are held for sale in accordance with FRS 5. There 

is no impact upon adoption of this amendment during the financial year. 

Amendment to FRS 128 Investments in Associates clarifies that investments in associates held by venture capital 

organisations, or mutual funds, unit trusts and similar entities shall make disclosures on the nature and extent of 

any significant restrictions on the ability of associates to transfer funds to the investor in the form of cash dividends, 

or repayment of loans or advances. This amendment also clarifies that impairment loss recognised in accordance 

with FRS 136 Impairment of Assets shall not be allocated to any asset, including goodwill, that forms the carrying 

amount of the investment. Accordingly, any reversal of that impairment loss shall be recognised in accordance 

with FRS 136. There is no impact upon adoption of this amendment during the financial year. 

Amendment to FRS 129 Financial Reporting in Hyperinflationary Economies streamlines the terms used in this 

Standard in accordance with the new terms used in FRS 101. This amendment also clarifies that assets and 

liabilities that are measured at fair value are exempted from the requirement to apply historical cost basis of 

accounting. There is no impact upon adoption of this amendment during the financial year. 



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Amendment to FRS 131 Interests in Joint Ventures clarifies that venturers’ interests in jointly controlled entities held 

by venture capital organisations, or mutual funds, unit trusts and similar entities shall make disclosures on related 

capital commitments. This amendment also clarifies that a listing and description of interests in significant joint 

ventures and the proportion of ownership interest held in jointly controlled entities shall be made. There is no 

impact upon adoption of this amendment during the financial year. 

Amendment to FRS 134 Interim Financial Reporting clarifies the need to present basic and diluted earnings per 

share for an interim period when the entity is within the scope of FRS 133 Earnings Per Share. There is no impact 


Amendment to FRS 136 clarifies the determination of allocation of goodwill to each cash-generating unit whereby 

each unit shall not be larger than an operating segment as defined in FRS 8 before aggregation. This amendment 

also requires additional disclosures if the fair value less costs to sell is determined using discounted cash flow 

projections. There is no impact upon adoption of this amendment during the financial year. 

Amendment to FRS 138 Intangible Assets clarifies the examples provided in this Standard in measuring the fair 

value of an intangible asset acquired in a business combination. This amendment also removes the statement on 

the rarity of situations whereby the application of the amortisation method for intangible assets results in a lower 

amount of accumulated amortisation than under the straight line method. There is no impact upon adoption of this 

amendment during the financial year. 

Amendment to FRS 140 clarifies that properties that are being constructed or developed for future use as 

investment property are within the definition of ‘investment property’. This amendment further clarifies that if 

the fair value of such properties cannot be reliably determinable but it is expected that the fair value would be 

readily determinable when construction is complete, the properties shall be measured at cost until either its fair 

value becomes reliably determinable or construction is completed, whichever is earlier. There is no impact upon 

adoption of this amendment during the financial year. 

(q) Amendments to FRS 132 is mandatory for annual periods beginning on or after 1 January 2010 and 1 March 

2010 in respect of the transitional provisions in accounting for compound financial instruments and classification 

of rights issues respectively. 

These amendments remove the transitional provisions in respect of accounting for compound financial instruments 

issued before 1 January 2003 pursuant to FRS 132 2004 Financial Instruments: Disclosure and Presentation. Such 

compound financial instruments shall be classified into its liability and equity components when FRS 139 first 

applies. 



Annual Report 2010



(r) Amendments to FRS 139 is mandatory for annual periods beginning on or after 1 January 2010. 

These amendments remove the scope exemption on contracts for contingent consideration in a business 

combination. Accordingly, such contracts shall be recognised and measured in accordance with the requirements 

of FRS 139. 


5.2 New FRSs that have been issued, but not yet effective and not yet adopted 


(a) Amendments to FRS 132 is mandatory for annual periods beginning on or after 1 March 2010 in respect of 

classification of rights issues. 

The amendments clarifies that rights, options or warrants to acquire a fixed number of the Group’s own equity 

instruments for a fixed amount of any currency shall be classified as equity instruments rather than financial 

liabilities if the Group offers the rights, options or warrants pro rata to all of its own existing owners of the same 

class of its own non-derivative equity instruments. 

The Group does not expect any impact on the financial statements arising from the adoption of these amendments. 

(b) FRS 1 First-time Adoption of Financial Reporting Standards is mandatory for annual periods beginning on or after 

1 July 2010. 

This Standard supersedes the existing FRS 1 and shall be applied when the Group adopts FRSs for the first time 

via the explicit and unreserved statement of compliance with FRSs. An opening FRS statement of financial position 

shall be prepared and presented at the date of transition to FRS, whereby: 

(i) All assets and liabilities shall be recognised in accordance with FRSs; 

(ii) Items of assets and liabilities shall not be recognised if FRSs do not permit such recognition; 

(iii) Items recognised in accordance with previous GAAP shall be reclassified in accordance with FRSs; and 

(iv) All recognised assets and liabilities shall be measured in accordance with FRSs. 

All resulting adjustments shall therefore be recognised directly in retained earnings at the date of transition to 

FRSs. 

The Group does not expect any impact on the financial statements arising from the adoption of this Standard. 



139

140 





5.2 New FRSs that have been issued, but not yet effective and not yet adopted (continued) 

(c) FRS 3 Business Combinations is mandatory for annual periods beginning on or after 1 July 2010. 

This Standard supersedes the existing FRS 3 and now includes business combinations involving mutual entities 

and those achieved by way of contract alone. Any non-controlling interest in an acquiree shall be measured at 

fair value or as the non-controlling interest’s proportionate share of the acquiree’s net identifiable assets. 

The time limit on the adjustment to goodwill due to the arrival of new information on the crystallisation of deferred 

tax benefits shall be restricted to the measurement period resulting from the arrival of the new information. 

Contingent liabilities acquired arising from present obligations shall be recognised, regardless of the probability 

of outflow of economic resources. 

Acquisition-related costs shall be accounted for as expenses in the periods in which the costs are incurred and the 

services are received. Consideration transferred in a business combination, including contingent consideration, 

shall be measured and recognised at fair value at acquisition date. 

In business combinations achieved in stages, the acquirer shall remeasure its previously held equity interest at its 

acquisition date fair value and recognise the resulting gain or loss in profit or loss. 


(d) FRS 127 Consolidated and Separate Financial Statements is mandatory for annual periods beginning on or after 

1 July 2010. 

This Standard supersedes the existing FRS 127 and replaces the current term ‘minority interest’ with a new term 

‘non-controlling interest’ which is defined as the equity in a subsidiary that is not attributable, directly or indirectly, 

to a parent. Accordingly, total comprehensive income shall be attributed to the owners of the parent and to the 

non-controlling interests, even if this results in the non-controlling interests having a deficit balance. 

Changes in the Group’s ownership interest in a subsidiary that do not result in a loss of control are accounted 

for as equity transactions. If the Group loses control of a subsidiary, any gains or losses are recognised in profit 

or loss and any investment retained in the former subsidiary shall be measured at its fair value at the date when 

control is lost. 

As at the end of the reporting period, the Group reports minority interests of RM123,459,000. The Group does 

not expect any impact on the financial statements arising from the adoption of this Standard. 

(e) Amendments to FRSs are mandatory for annual periods beginning on or after 1 July 2010. 

Amendments to FRS 2 Share-based Payment clarifies that transactions in which the Group acquired goods as 

part of the net assets acquired in a business combination or contribution of a business on the formation of a joint 

venture are excluded from the scope of this Standard. The Group does not expect any impact on the financial 

statements arising from the adoption of this amendment. 


Annual Report 2010




(e) Amendments to FRSs are mandatory for annual periods beginning on or after 1 July 2010. (continued) 

Amendments to FRS 5 clarifies that non-current asset classified as held for distribution to owners acting in their 

capacity as owners are within the scope of this Standard. The amendment also clarifies that in determining whether a 

sale is highly probable, the probability of shareholders’ approval, if required in the jurisdiction, shall be considered. 

In a sale plan involving loss of control of a subsidiary, all assets and liabilities of that subsidiary shall be classified as 

held for sale, regardless of whether the Group retains a non-controlling interest in its former subsidiary after the sale. 

Discontinued operations information shall also be presented. Non-current asset classified as held for distribution to 

owners shall be measured at the lower of its carrying amount and fair value less costs to distribute. The Group does 

not expect any impact on the financial statements arising from the adoption of this amendment. 

Amendments to FRS 138 clarifies that the intention of separating an intangible asset is irrelevant in determining the 

identifiability of the intangible asset. In a separate acquisition and acquisition as part of a business combination, 

the price paid by the Group reflects the expectations of the Group of an inflow of economic benefits, even 

if there is uncertainty about the timing or the amount of the inflow. Accordingly, the probability criterion is 

always considered to be satisfied for separately acquired intangible assets. The useful life of a reacquired right 

recognised as an intangible asset in a business combination shall be the remaining contractual period of the 

contract in which the right was granted, and do not include renewal periods. In the case of a reacquired right in 

a business combination, if the right is subsequently reissued to a third party, the related carrying amount shall be 

used in determining the gain or loss on reissue. The Group does not expect any impact on the financial statements 

arising from the adoption of this amendment. 

Amendments to IC Interpretation 9 clarifies that embedded derivatives in contracts acquired in a business 

combination, combination of entities or business under common controls, or the formation of a joint venture are 

excluded from this Interpretation. The Group does not expect any impact on the financial statements arising from 

the adoption of this amendment. 

(f) IC Interpretation 12 Service Concession Arrangements is mandatory for annual periods beginning on or after 1 

July 2010. 

This Interpretation applies to operators for public-to-private service concession arrangements, whereby infrastructure 

within the scope of this Interpretation shall not be recognised as property, plant and equipment of the operator. 

The operator shall recognise and measure revenue in accordance with FRS 111 Construction Contracts and FRS 

118 for the services performed. The operator shall also account for revenue and costs relating to construction or 

upgrade services in accordance with FRS 111. 

Consideration received or receivable by the operator for the provision of construction or upgrade services shall 

be recognised at its fair value. If the consideration consists of an unconditional contractual right to receive cash or 

another financial asset from the grantor, it shall be classified as a financial asset. Conversely, if the consideration 

consists of a right to charge users of the public service, it shall be classified as an intangible asset. 

The Group does not expect any impact on the financial statements arising from the adoption of this Interpretation. 



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(g) IC Interpretation 16 Hedges of a Net Investment in a Foreign Operation is mandatory for annual periods beginning 

on or after 1 July 2010. 

This Interpretation applies to hedges undertaken on foreign currency risk arising from net investments in foreign 

operations and the Group wishes to qualify for hedge accounting in accordance with FRS 139. 

Hedge accounting is applicable only to the foreign exchange differences arising between the functional currency 

of the foreign operation and the functional currency of any parent (immediate, intermediate or ultimate parent) of 

that foreign operation. An exposure to foreign currency risk arising from a net investment in a foreign operation 

may qualify for hedge accounting only once in the consolidated financial statements. 

Hedging instruments designated in the hedge of a net investment in a foreign operation may be held by any 

companies within the Group, as long as the designation, documentation and effectiveness requirements of FRS 

139 are met. The Group does not expect any impact on the financial statements arising from the adoption of this 

Interpretation. 

(h) IC Interpretation 17 Distributions of Non-cash Assets to Owners is mandatory for annual periods beginning on or 

after 1 July 2010. 

This Interpretation applies to non-reciprocal distributions of non-cash assets by the Group to its owners in their 

capacity as owners, as well as distributions that give owners a choice of receiving either non-cash assets or a 

cash alternative. This Interpretation also applies to distributions in which all owners of the same class of equity 

instruments are treated equally. 

The liability to pay a dividend shall be recognised when the dividend is appropriately authorised and is no longer 

at the discretion of the Group. The liability shall be measured at the fair value of the assets to be distributed. If the 

Group gives its owners a choice of receiving either a non-cash asset or a cash alternative, the dividend payable 

shall be estimated by considering the fair value of both alternatives and the associated probability of the owners’ 

selection. 

At the end of each reporting period, the carrying amount of the dividend payable shall be remeasured and any 

changes shall be recognised in equity. At the settlement date, any difference between the carrying amounts of 

the assets distributed and the carrying amount of the dividend payable shall be recognised in profit or loss. The 

Group does not expect any impact on the financial statements arising from the adoption of this Interpretation. 

(i) Amendment to FRS 1 Limited Exemption from Comparative FRS 7 Disclosures for First-time Adopters is mandatory 

for annual periods beginning on or after 1 January 2011. 

This amendment permits a first-time adopter of FRSs to apply the exemption of not restating comparatives for the 

disclosures required in Amendments to FRS 7. 

The Group does not expect any impact on the financial statements arising from the adoption of this amendment. 


Annual Report 2010




(j) Amendments to FRS 1 Additional Exemptions for First-time Adopters are mandatory for annual periods beginning 


These amendments permits a first-time adopter of FRSs to apply the exemption of not restating the carrying 

amounts of oil and gas assets determined under previous GAAP. 


(k) Amendments to FRS 7 Improving Disclosures about Financial Instruments are mandatory for annual periods 


These amendments require enhanced disclosures of fair value of financial instruments based on the fair value 

hierarchy, including the disclosure of significant transfers between Level 1 and Level 2 of the fair value hierarchy 

as well as reconciliations for fair value measurements in Level 3 of the fair value hierarchy. 

By virtue of the exemption provided under paragraph 44G of FRS 7, the impact of applying these amendments 

on the financial statements upon first adoption of FRS 7 as required by paragraph 30(b) of FRS 108 are not 

disclosed. 

(l) Amendments to FRS 2 Group Cash-settled Share-based Payment Transactions are mandatory for annual periods 


These amendments clarify the scope and the accounting for group cash-settled share-based payment transactions 

in the separate financial statements of the entity receiving the goods or services when that entity has no obligation 

to settle the share-based payment transaction. 

Consequently, IC Interpretation 8 Scope of FRS 2 and IC Interpretation 11 have been superseded and withdrawn. 


The effects of adopting IC Interpretation 11 have been disclosed in Note 5.1(j) to the financial statements. 

(m) IC Interpretation 4 Determining whether an Arrangement contains a Lease is mandatory for annual periods 


This Interpretation requires the determination of whether an arrangement is, or contains, a lease based on 

an assessment of whether the fulfilment of the arrangement is dependent on the use of a specific asset and 

whether the arrangement conveys a right to use the asset. This assessment shall be made at the inception of the 

arrangement and subsequently reassessed if certain condition(s) in the Interpretation is met. 

The Group does not expect any impact on the financial statements arising from the adoption of this amendment 

because there are no arrangements dependent on the use of specific assets in the Group. 



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(n) IC Interpretation 18 Transfers of Assets from Customers is mandatory for annual periods beginning on or after 1 

January 2011. 

This Interpretation applies to agreements in which an entity receives from a customer an item of property, plant 

and equipment that must be used to either connect the customer to a network or to provide the customer with 

ongoing access to a supply of goods or services. The entity receiving the transferred item is required to assess 

whether the transferred item meets the definition of an asset set out in the Framework. The credit entry would be 

accounted for as revenue in accordance with FRS 118. 

The Group does not expect any impact on the financial statements arising from the adoption of this Interpretation 

because there are no such arrangements in the Group. 

(o) IC Interpretation 15 Agreements for the Construction of Real Estate is mandatory for annual periods beginning on 

or after 1 January 2012. 

This Interpretation applies to the accounting for revenue and associated expenses by entities undertaking 

construction of real estate directly or via subcontractors. Within a single agreement, the Group may contract to 

deliver goods or services in addition to the construction of real estate. Such an agreement shall therefore, be split 

into separately identifiable components. 

An agreement for the construction of real estate shall be accounted for in accordance with FRS 111 if the buyer 

is able to specify the major structural elements of the design of the real estate before construction begins and/or 

specify major structural changes once construction is in progress. Accordingly, revenue shall be recognised by 

reference to the stage of completion of the contract. 

An agreement for the construction of real estate in which buyers only have limited ability to influence the design 

of the real estate or to specify only minor variations to the basic designs is an agreement for the sale of goods 

in accordance with FRS 118. Accordingly, revenue shall be recognised by reference to the criteria in paragraph 

14 of FRS 118 (e.g. transfer of significant risks and rewards, no continuing managerial involvement nor effective 

control, reliable measurement, etc.). 

The Group does not expect any significant impact on the financial statements arising from the adoption of this 

Interpretation. 

(p) Improvements to FRSs (2010) are mandatory for annual periods beginning on or after 1 January 2011. 

Amendments to FRS 1 clarifies that FRS 108 does not apply to changes in accounting policies made upon 

adoption of FRSs until after the first FRS financial statements have been presented. If changes in accounting 

policies or exemptions in this FRS are used, an explanation of such changes together with updated reconciliations 

shall be made in each interim financial report. Entities whose operations are subject to rate regulation are 

permitted the use of previously revalued amounts as deemed cost. The Group does not expect any impact on the 

financial statements arising from the adoption of this amendment. 


Annual Report 2010





Amendments to FRS 3 clarifies that for each business combination, the acquirer shall measure at the acquisition 

date non-controlling interests that consists of the present ownership interests and entitle holders to a proportionate 

share of the entity’s net assets in the event of liquidation. Un-replaced and voluntarily replaced share-based 

payment transactions shall be measured using the market-based measurement method in accordance with FRS 2 

at the acquisition date. The Group does not expect any impact on the consolidated financial statements arising 

from the adoption of these amendments. 

Amendments to FRS 7 clarifies that quantitative disclosures of risk concentrations are required if the disclosures 

made in other parts of the financial statements are not readily apparent. The disclosure on maximum exposure to 

credit risk is not required for financial instruments whose carrying amount best represents the maximum exposure 

to credit risk. The Group expects to improve the disclosures on maximum exposure to credit risk upon adoption of 

these amendments. 

Amendments to FRS 101 clarify that a statement of changes in equity shall be presented as part of a complete 

set of financial statements. The Group does not expect any impact on the financial statements arising from the 

adoption of these amendments. 

Amendments to FRS 121 The Effects of Changes in Foreign Exchange Rates clarify that the accounting treatment 

for cumulative foreign exchange differences in other comprehensive income for the disposal or partial disposal 

of a foreign operation shall be applied prospectively. The Group does not expect any impact on the financial 

statements arising from the adoption of these amendments. 

Amendments to FRS 128 clarify that the accounting treatment for the cessation of significant influence over an 

associate shall be applied prospectively. The Group does not expect any impact on the consolidated financial 

statements arising from the adoption of these amendments. 

Amendments to FRS 131 clarify that the accounting treatment for the cessation of joint control over an entity shall 

be applied prospectively. The Group does not expect any impact on the consolidated financial statements arising 

from the adoption of these amendments. 

Amendments to FRS 132 clarify that contingent consideration from a business combination that occurred before 

the effective date of the revised FRS 3 of 1 July 2010 shall be accounted for prospectively. The Group does not 

expect any impact on the financial statements arising from the adoption of these amendments. 

Amendments to FRS 134 Interim Financial Reporting clarify that updated information on significant events and 

transactions since the end of the last annual reporting period shall be included in the Group’s interim financial 

report. Although the Group does not expect any impact on the financial statements arising from the adoption 

of these amendments, it is expected that additional disclosures would be made in the quarterly interim financial 

statements of the Group. 



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Amendments to FRS 139 clarify that contingent consideration from a business combination that occurred before 

the effective date of the revised FRS 3 of 1 July 2010 shall be accounted for prospectively. The Group does not 

expect any impact on the financial statements arising from the adoption of these amendments. 

Amendments to IC Interpretation 13 clarify that the fair value of award credits takes into account, amongst others, 

the amount of the discounts or incentives that would otherwise be offered to customers who have not earned 

award credits from an initial sale. The Group does not expect any impact on the financial statements arising from 

the adoption of these amendments. 

(q) Amendments to IC Interpretation 14 FRS 119 – The Limit on a Defined Benefit Asset, Minimum Funding Requirements 

and their Interaction are mandatory for annual periods beginning on or after 1 July 2011. 

These amendments clarify that if there is a minimum funding requirement for contributions relating to future 

service, the economic benefit available as a reduction in future contributions shall include any amount that 

reduces future minimum funding requirement contributions for future service because of the prepayment made. 


(r) IC Interpretation 19 Extinguishing Financial Liabilities with Equity Instruments is mandatory for annual periods 

beginning on or after 1 July 2011. 

This Interpretation applies to situations when equity instruments are issued to a creditor to extinguish all or part 

of a recognised financial liability. Such equity instruments shall be measured at fair value, and the difference 

between the carrying amount of the financial liability extinguished and the consideration paid shall be recognised 

in profit or loss. 

The Group does not expect any impact on the financial statements arising from the adoption of this Interpretation. 

(s) FRS 124 Related Party Disclosures and the consequential amendments to FRS 124 are mandatory for annual 

periods beginning on or after 1 January 2012. 

This revised Standard simplifies the definition of a related party and eliminates certain inconsistencies within the 

superseded version. In addition to this, transactions and balances with government-related entities are broadly 

exempted from the disclosure requirements of the Standard. 



Annual Report 2010

6. SIGNIFICANT ACCOUNTING ESTIMATES AND JUDGMENTS 

Estimates and judgments used in preparing the financial statements are continually evaluated by the Directors and are based 

on historical experience and other factors, including expectations of future events that are believed to be reasonable under 

the circumstances. 

6.1 Critical judgments made in applying accounting policies 

The following are critical judgments made by management in the process of applying the Group’s accounting policies 

that have a significant effect on the amounts recognised in the financial statements. 

(a) Non-current assets held for sale 

Certain non-current assets and liabilities have been classified as non-current assets held for sale as the management 

has committed to a plan to sell the assets and liabilities as at the end of the reporting period. Barring any 

unforeseen circumstances, the Group expects that the sale of the assets and liabilities to be completed within the 

next twelve (12) months. 

(b) Contingent liabilities 

Determination of the treatment of contingent liabilities is based on management’s view of the expected outcome of 

the contingencies after consulting legal counsel for litigation cases and internal and external experts to the Group 

for matters in the ordinary course of the business. 

6.2 Key sources of estimation uncertainty 

The following are key assumptions concerning the future and other key sources of estimation uncertainty at the end of 

the reporting period that have a significant risk of causing a material adjustment to the carrying amounts of assets and 

liabilities within the next financial year: 

(a) Depreciation and amortisation of property, plant and equipment 


The cost of property, plant and equipment is depreciated on a straight-line basis over the assets’ useful lives. 

The estimated useful lives applied by the Group as disclosed in Note 4.3 to the financial statements reflect the 

Directors’ estimate of the period that the Group expects to derive future economic benefits from the use of the 

Group’s property, plant and equipment. These common life expectancies are applied in the various business 

segments of the Group. Changes in the expected level of usage and technological developments could impact 

the economic useful lives and the residual values of these assets; therefore future depreciation and amortisation 

charges could be revised. 



147

148 




6. SIGNIFICANT ACCOUNTING ESTIMATES AND JUDGMENTS (continued) 

6.2 Key sources of estimation uncertainty (continued) 

(b) Impairment of goodwill on consolidation 

The Group tests goodwill for impairment at least annually in accordance with its accounting policy. (See accounting 

policy Note 4.9 to the financial statements on impairment of goodwill). 

For the purposes of assessing impairment, goodwill is allocated to cash-generating units that are expected to 

benefit from the synergies of the business combination in which the goodwill arose. 

Significant judgment is required in the estimation of the present value of future cash flows generated by the cash 

generating units, which involve uncertainties and are significantly affected by assumptions used and judgment 

made regarding estimates of future cash flows and discount rates. Changes in assumptions could significantly 

affect the results of the Group’s tests for impairment of goodwill. The key assumptions used are disclosed in Note 

13 to the financial statements. 

(c) Income taxes 

Significant judgment is required in determining the capital allowances and deductibility of certain expenses based 

on the interpretation of the tax laws and legislations during the estimation of the provision for income taxes. There 

are transactions and calculations for which the ultimate tax determination is uncertain during the ordinary course of 

business. The Group recognised liabilities for tax based on estimates of assessment of the tax liability due. Where the 

final tax outcome is different from the amounts that were initially recorded, such differences will impact the income tax 

and deferred income tax provisions, where applicable, in the period in which such determination is made. 

(d) Deferred tax assets 

Deferred tax assets are recognised for all unused tax losses and unabsorbed capital and agriculture allowances 

to the extent that it is probable that taxable profits will be available against which the tax losses and capital and 

agriculture allowances can be utilised. Significant management judgment is required to determine the amount of 

deferred tax assets that can be recognised, based upon the likely timing and level of future taxable profits together 

with future tax planning strategies. 

(e) Fair values of borrowings 

The fair values of borrowings are estimated by discounting future contractual cash flows at the current market 

interest rates available to the Group for similar financial instruments. It is assumed that the effective interest rates 

approximate the current market interest rates available to the Group based on its size and its business risk. 


Annual Report 2010

6. SIGNIFICANT ACCOUNTING ESTIMATES AND JUDGMENTS (continued) 

6.2 Key sources of estimation uncertainty (continued) 

(f) Write-down for obsolete or slow-moving inventories 

The Group writes down its obsolete or slow-moving inventories based on assessment of their estimated net selling 

price. Inventories are written down when events or changes in circumstances indicate that the carrying amounts 

may not be recoverable. The management specifically analyses sales trend and current economic trends when 

making a judgment to evaluate the adequacy of the write-down for obsolete or slow-moving inventories. Where 

expectations differ from the original estimates, the differences will impact the carrying amount of inventories. 

(g) Impairment of assets 

The Group determines whether an asset is impaired by evaluating the extent to which the recoverable amount of an 

asset is less than its carrying amount. This evaluation is subject to changes such as market performance, economic 

and political situation of the country. 

Recoverable amount is measured at the higher of the fair value less cost to sell for that asset and its value in use. 

Value in use is the net present value of the projected future cash flows derived from that asset discounted at an 

appropriate discount rate. For such discounted cash flow method, it involves the use of estimated future results and a 

set of assumptions to reflect its income and cash flows. Judgment has been used to determine the discount rate for 

the cash flows and the future growth of the business. 

(h) Impairment of investments in subsidiaries 


The Directors review the material investments in subsidiaries for impairment when there is an indication of 

impairment. 

The recoverable amounts of the investments in subsidiaries are assessed by reference to the value in use of the 

respective subsidiaries. 

The value in use is the net present value of the projected future cash flows derived from the business operations 

of the respective subsidiaries discounted at an appropriate discount rate. For such discounted cash flow method, 

it involves the use of estimated future results and a set of assumptions to reflect their income and cash flows. 

Judgment has been used to determine the discount rate for the cash flows and the future growth of the businesses 

of the subsidiaries. 



149



7. PROPERTY, PLANT AND EQUIPMENT 

150 

Balance Acquisition Assets Balance 

Group as at of a Written retired Reclassi- as at 31 

2010 1 January subsidiary Additions Disposals off from use fication December 

(Restated) 

RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 

(Note 34) 

Cost 


Freehold land 52,232 - - - - - - 52,232 

Long term leasehold land 1,212,169 3,292 1,504 (1,041) - - - 1,215,924 

Plantation development 

expenditure 1,336,496 - 142,311 - (16) (20,984) - 1,457,807 

Buildings 223,588 - 8,977 - - - 4,780 237,345 

Plant and machinery 169,657 - 12,316 (171) (2) - 1,865 183,665 

Motor vehicles 58,991 - 6,395 (1,605) (597) - 414 63,598 

Office equipment 11,996 - 1,478 (220) (196) - (183) 12,875 

Furniture and fittings 10,355 - 2,010 (1) (1,411) - 184 11,137 

Access road 80,917 - 16,374 - - - 7,472 104,763 

Capital work-in-progress 23,288 - 19,453 - - - (14,532) 28,209 



3,179,689 3,292 210,818 (3,038) (2,222) (20,984) - 3,367,555

7. PROPERTY, PLANT AND EQUIPMENT (continued) 

Charge 

Balance Acquisition for the Assets Balance 

Group as at of a financial Written retired Reclassi- as at 31 

2010 1 January subsidiary year Disposals off from use fication December 

Accumulated 

depreciation 

(Restated) 

RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 

(Note 34) 


Freehold land - - - - - - - - 

Long term leasehold land 84,615 - 17,095 (29) - - - 101,681 

Plantation development 

expenditure 324,860 - 53,185 - - (20,984) - 357,061 

Buildings 94,982 - 11,058 - - - 1 106,041 

Plant and machinery 94,095 - 10,517 (171) (2) - (160) 104,279 

Motor vehicles 42,879 - 5,721 (1,239) (596) - 159 46,924 

Office equipment 7,383 - 1,497 (135) (173) - (134) 8,438 

Furniture and fittings 5,742 - 933 - (576) - 134 6,233 

Access road 27,669 - 4,675 - - - - 32,344 

Capital work-in-progress - - - - - - - - 

682,225 - 104,681 (1,574) (1,347) (20,984) - 763,001 



151




152 

Transfer to 

Balance Acquisition Assets non-current Balance 

Group as at of a Written retired Reclassi- assets held Exchange as at 31 

2009 1 January subsidiary Additions Disposals off from use fication for sale differences December 


RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 

(Note 34) (Note 17) 

Cost 


Freehold land 52,232 - - - - - - - - 52,232 

Long term leasehold 

land 1,199,764 12,472 - (67) - - - - - 1,212,169 

Plantation 

development 

expenditure 1,218,404 - 120,304 - (209) (2,343) - - 340 1,336,496 

Buildings 213,086 - 5,997 - (412) - 4,839 - 78 223,588 

Plant and machinery 160,326 - 11,717 (235) (553) - 3,875 (5,500) 27 169,657 

Motor vehicles 52,905 254 6,412 (403) (2,448) - 2,267 - 4 58,991 

Office equipment 18,690 77 862 - (265) - (7,368) - - 11,996 

Furniture and fittings 8,067 112 1,017 - (476) - 1,633 - 2 10,355 

Access road 59,439 - 7,214 - - - 14,264 - - 80,917 

Capital work-inprogress 

22,287 - 20,511 - - - (19,510) - - 23,288 



3,005,200 12,915 174,034 (705) (4,363) (2,343) - (5,500) 451 3,179,689


Charge Transfer to 

Balance Acquisition for the Assets non-current Balance 

Group as at of a financial Written retired Reclassi- assets held Exchange as at 31 

2009 1 January subsidiary year Disposals off from use fication for sale differences December 


RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 

(Note 34) (Note 17) 

Accumulated 

depreciation 


Freehold land - - - - - - - - - - 

Long term leasehold 

land 67,471 207 16,940 (3) - - - - - 84,615 


development 

expenditure 281,626 - 45,536 - (55) (2,343) - - 96 324,860 

Buildings 86,015 - 9,311 - (404) - (8) - 68 94,982 

Plant and machinery 87,630 - 11,476 (234) (553) - 467 (4,716) 25 94,095 

Motor vehicles 37,396 226 7,036 (335) (2,447) - 1,002 - 1 42,879 

Office equipment 9,800 49 1,592 - (262) - (3,796) - - 7,383 

Furniture and fittings 4,100 65 858 - (465) - 1,184 - - 5,742 

Access road 22,837 - 3,681 - - - 1,151 - - 27,669 

Capital work-inprogress 

- - - - - - - - - - 

596,875 547 96,430 (572) (4,186) (2,343) - (4,716) 190 682,225 



153




154 


Company as at Written as at 31 

2010 1 January Additions Disposals off December 

RM’000 RM’000 RM’000 RM’000 RM’000 

Cost 


Motor vehicles 3,411 479 (845) - 3,045 

Office equipment 2,399 955 (220) (23) 3,111 

Furniture and fittings 1,334 1,119 - (1,334) 1,119 

Accumulated depreciation 



7,144 2,553 (1,065) (1,357) 7,275 

Charge 

Balance for the Balance 

as at financial Written as at 31 

1 January year Disposals off December 

RM’000 RM’000 RM’000 RM’000 RM’000 

Motor vehicles 1,773 560 (661) - 1,672 

Office equipment 1,196 530 (135) (14) 1,577 

Furniture and fittings 471 134 - (537) 68 

3,440 1,224 (796) (551) 3,317



Company as at as at 31 

2009 1 January Additions December 

RM’000 RM’000 RM’000 

Cost 

Motor vehicles 3,069 342 3,411 

Office equipment 2,246 153 2,399 

Furniture and fittings 1,330 4 1,334 

Accumulated depreciation 


6,645 499 7,144 

Charge 

Balance for the Balance 

as at financial as at 31 

1 January year December 

RM’000 RM’000 RM’000 

Motor vehicles 1,069 704 1,773 

Office equipment 786 410 1,196 

Furniture and fittings 337 134 471 

2,192 1,248 3,440 



155

156 





Net carrying amount 



Group Company 

2010 2009 2010 2009 

(Restated) 

RM’000 RM’000 RM’000 RM’000 

Freehold land 52,232 52,232 - - 

Long term leasehold land 1,114,243 1,127,554 - - 

Plantation development expenditure 1,100,746 1,011,636 - - 

Buildings 131,304 128,606 - - 

Plant and machinery 79,386 75,562 - - 

Motor vehicles 16,674 16,112 1,373 1,638 

Office equipment 4,437 4,613 1,534 1,203 

Furniture and fittings 4,904 4,613 1,051 863 

Access road 72,419 53,248 - - 

Capital work-in-progress 28,209 23,288 - - 

2,604,554 2,497,464 3,958 3,704 

(a) During the financial year, the Group reassessed its long term leases of land in accordance with the Amendment to 

FRS 117 Leases to be finance leases. The classification of prepaid lease payments for land as property, plant and 

equipment has been accounted for retrospectively. 

(b) The net carrying amounts of property, plant and equipment of the Group charged to financial institutions for credit 

facilities granted to the Group and the Company (as disclosed in Notes 22, 23 and 25 to the financial statements) are 

as follows: 

Group 

2010 2009 

(Restated) 

RM’000 RM’000 

Freehold land 20,352 20,352 

Long term leasehold land 638,493 646,482 

Plantation development expenditure 817,820 758,046 

Buildings 33,900 36,876 

Plant and machinery 44,637 45,289 

1,555,202 1,507,045


(c) Included in additions of plantation development expenditure for the financial year are the following: 

Group 

2010 2009 

RM’000 RM’000 

Staff costs 16,285 16,560 

Pension cost - defined contribution plan 696 693 

Finance costs 13,690 9,376 

Depreciation of property, plant and equipment 2,707 2,370 

(d) During the financial year, the Group and the Company made the following cash payments to purchase property, plant 

and equipment: 

Group Company 

2010 2009 2010 2009 

RM’000 RM’000 RM’000 RM’000 

Additions of property, plant and equipment 210,818 174,034 2,553 499 

Less: Finance costs capitalised (13,690) (9,376) - - 

Less: Depreciation capitalised (2,707) (2,370) - - 

Cash payments on purchase of property, 

plant and equipment 194,421 162,288 2,553 499 

8. LAND HELD FOR PROPERTY DEVELOPMENT 


Group 

2010 2009 

RM’000 RM’000 

Long term leasehold land, at cost 

Balance as at 1 January 87,412 - 

Arising from acquisition of a subsidiary (Note 34) - 87,412 

Balance as at 31 December 87,412 87,412 

An approved master plan had been obtained for the development of the second border town between Malaysia and 

Thailand known as ‘Bandar Sempadan Kota Putra’. 



157

158 




9. INVESTMENTS IN SUBSIDIARIES 



Company 

2010 2009 

RM’000 RM’000 

Unquoted shares, at cost 

- Ordinary shares 1,279,640 1,279,640 

- Redeemable convertible preference shares 107,750 107,750 

1,387,390 1,387,390 

Less: Distribution of pre-acquisition reserves (71,374) (71,374) 

Less: Accumulated impairment losses (1,563) (1,563) 

(a) The details of the subsidiaries are as follows: 

1,314,453 1,314,453 

Interest in equity held by 

Country of Company Subsidiary 

Name of company incorporation 2010 2009 2010 2009 Principal activities 

% % % % 

*Kumpulan Kris Jati Sdn. Bhd. Malaysia 70 70 - - Cultivation of oil palm and 

producing crude palm oil 

*Ladang Permai Sdn. Bhd. Malaysia 100 100 - - Cultivation of oil palm and 


*Bahtera Bahagia Sdn. Bhd. Malaysia 70 70 - - Cultivation of oil palm 

*Binu Plantations Sdn. Bhd. Malaysia 100 100 - - Cultivation of oil palm and 


#Quek Shin & Sons Pte. Ltd. Singapore 100 100 - - Cultivation of oil palm 

Teon Choon Realty Company Malaysia 100 100 - - Cultivation of oil palm 

Sdn. Berhad

9. INVESTMENTS IN SUBSIDIARIES (continued) 

(a) The details of the subsidiaries are as follows: (continued) 





% % % % 

Ladang Mawar Sdn. Bhd. Malaysia 100 100 - - Cultivation of oil palm 

Ibok Plantation Sdn. Bhd. Malaysia 100 100 - - Cultivation of oil palm 

Syarikat Ladang Sawit Cherul Malaysia 100 100 - - Cultivation of oil palm 

Sdn. Bhd. 

Barisan Tekad Sdn. Bhd. Malaysia 70 70 - - Cultivation of oil palm 

Ladang Chendana Sdn. Bhd. Malaysia 100 100 - - Cultivation of oil palm 

Ladang Serasa Sdn. Berhad Malaysia 100 100 - - Cultivation of oil palm and 


Tradewinds Plantation Malaysia 100 100 - - Ceased operations 

Services Sdn. Bhd. 

*Amalan Penaga (M) Malaysia 100 100 - - Investment holding 

Sdn. Bhd. 

Tradewinds Plantation Malaysia 100 100 - - Plantation management 

Management Sdn. Bhd. and advisory services 

Tradewinds Plantech Malaysia 100 100 - - Plantation management 

Sdn. Bhd. and advisory services 

Tradewinds Agro Services Malaysia 100 100 - - Plantation management 

Sdn. Bhd. and advisory services 



159

160 









% % % % 

Tradewinds Plantation Capital Malaysia 100 100 - - Sole and specific purpose 

Sdn. Bhd. of undertaking Islamic 

Securities transactions 

Johore Tenggara Oil Palm Malaysia 100 100 - - Investment holding 

Berhad 

*Tradewinds Corridor Malaysia 100 100 - - Cultivation of oil palm 

Sdn. Bhd. and rubber trees 

*Northern Intergrated Malaysia 70 70 - - Property development 

Agriculture Sdn. Bhd. 

Prisma Spektra Sdn. Bhd. Malaysia 100 100 - - Investment holding 

Subsidiaries of 

Johore Tenggara Oil 

Palm Berhad 

Ladang Petri Tenggara Malaysia - - 100 100 Cultivation of oil palm and 

Sdn. Bhd. producing crude palm oil 

Pertanian Johor Tenggara Malaysia - - 100 100 Cultivation of oil palm 

Sdn. Bhd. 

Agromaju Sdn. Bhd. Malaysia - - 100 100 Cultivation of oil palm 

^Insan Delima Sdn. Bhd. Malaysia - - - 100 Ceased operations 

Barisan Perangsang Malaysia - - 51 51 Ceased operations 

Sdn. Bhd. 

^JTOP Lebir Plantation Malaysia - - - 100 Dormant 

Sdn. Bhd. 


Annual Report 2010






% % % % 

Agromaju Landscape Malaysia - - 100 100 Ceased operations 

Sdn. Bhd. 

*Semai Segar Sdn. Bhd. Malaysia - - 100 100 Cultivation of oil palm 

*Permodalan Pelangi Malaysia - - 100 100 Cultivation of oil palm 

Sdn. Bhd. 

*Tanah Semai Sdn. Bhd. Malaysia - - 100 100 Cultivation of oil palm 

*/^Gugusan Induk Sdn. Bhd. Malaysia - - - 100 Dormant 

*Uni-Agro Plantations Malaysia - - 100 100 Cultivation of oil palm 

(Trengganu) Sdn. Bhd. 

*M.P. Plantation Sdn. Bhd. Malaysia - - 100 100 Investment holding 

*Hak JTOP Sdn. Bhd. Malaysia - - 100 40 Investment holding but is 

currently dormant 

Subsidiary of 

M.P. Plantation Sdn. Bhd. 

*Ladang Sungai Relai Malaysia - - 70 70 Cultivation of oil palm 

Sdn. Bhd. 

Subsidiary of 

Teon Choon Realty 

Company Sdn. Berhad 


^Teon Choon Quarry Malaysia - - - 100 Ceased operations 

Sdn. Bhd. 



161

162 









% % % % 


Amalan Penaga (M) 

Sdn. Bhd. 

*Melur Gemilang Sdn. Bhd. Malaysia - - 70 70 Cultivation of oil palm and 


*Tradewinds Tanjung Alan Malaysia - - 70 70 Cultivation of oil palm 

Plantation Sdn. Bhd. 

*Trans Kenyalang Sdn. Bhd. Malaysia - - 85 85 Cultivation of oil palm 

*Arah Bersama Sdn. Bhd. Malaysia - - 70 70 Cultivation of oil palm 

*Amalan Pelita Pasai Malaysia - - 60 60 Cultivation of oil palm 

Sdn. Bhd. 

*Senandung Masyhur Malaysia - - 85 85 Cultivation of oil palm 

Sdn. Bhd. 

*Usaha Wawasan Sdn. Bhd. Malaysia - - 70 70 Cultivation of oil palm 


Northern Intergrated 

Agriculture Sdn. Bhd. 

*NIA Development Sdn. Bhd. Malaysia - - 70 70 Dormant 

*NIA Infrastructure Sdn. Bhd. Malaysia - - 70 70 Dormant 

* Subsidiary not audited by BDO 

# Subsidiary audited by member firm of BDO International 

^ Subsidiary struck-off from Companies Commission of Malaysia’s register during the financial year and therefore 

not consolidated. 


Annual Report 2010


(b) Subsidiaries struck-off from the register 

On 30 December 2009, the Company had submitted applications to the Companies Commission of Malaysia (‘CCM’) 

to strike off from CCM’s register its wholly-owned dormant subsidiaries, namely Gugusan Induk Sdn. Bhd. (‘GISB’), 

Insan Delima Sdn. Bhd. (‘IDSB’), JTOP Lebir Plantation Sdn. Bhd. (‘JTOP Lebir’) and Teon Choon Quarry Sdn. Bhd. 

(‘TCQSB’), under Section 308 of the Companies Act, 1965. 

During the current financial year, the Company received the following striking-off notices from the CCM pursuant to 

the application for the striking-off: 




Accordingly, GISB and JTOP Lebir were struck-off from CCM’s register on 7 September 2010 and TCQSB and IDSB 

were struck-off from CCM’s register on 17 September 2010 and 13 October 2010 respectively. 

The striking-off of GISB, JTOP Lebir, TCQSB and IDSB has no material effect to the Group’s assets and liabilities and 

financial results for the current financial year. 

10. INVESTMENT IN AN ASSOCIATE 

Group 

2010 2009 

RM’000 RM’000 

Unquoted shares, at cost - * 

Share of post-acquisition reserves - - 

* Denotes RM4 




- * 

163

164 




10. INVESTMENT IN AN ASSOCIATE (continued) 

Details of the associate in the previous financial year was as follows: 

Country of Interest in equity 

Name of company incorporation held by subsidiary Principal activity 

2010 2009 

% % 

Hak JTOP Sdn. Bhd. Malaysia 100 40 Investment holding but 

is currently dormant 

In the previous financial years, the financial results of Hak JTOP Sdn. Bhd. (‘Hak JTOP’) had not been equity accounted due 

to the unavailability of financial statements. The associate was inactive and the Directors were of the opinion that the effect 

of the non-equity accounting of the share of results of Hak JTOP was not material to the financial statements of the Group 

for the previous financial years. 

On 9 June 2010, the Company’s wholly-owned subsidiary, Johore Tenggara Oil Palm Berhad (‘JTOP’), acquired the 

remaining 60% equity interest in Hak JTOP for a cash consideration of RM3,200,000. Consequently, Hak JTOP became a 

wholly-owned subsidiary of JTOP. 

11. INVESTMENT IN A JOINTLY CONTROLLED ENTITY 



Group Company 

2010 2009 2010 2009 

RM’000 RM’000 RM’000 RM’000 

Unquoted shares, at cost 

- Ordinary shares 10,000 10,000 10,000 10,000 

- Redeemable convertible preference shares (‘RCPS’) 5,000 5,000 5,000 5,000 

15,000 15,000 15,000 15,000 

Share of post-acquisition reserves (1,511) (2,777) - - 

13,489 12,223 15,000 15,000

11. INVESTMENT IN A JOINTLY CONTROLLED ENTITY (continued) 

(a) On 19 October 2009, the Company entered into a supplemental agreement to the Shareholders Agreement dated 1 

August 2008 with CB Industrial Product Holding Berhad (‘CBIP’) to subscribe equally for 20,000,000 RCPS of RM1 

each at an issue price of RM1 each in the jointly controlled entity, Pride Palm Oil Mill Sdn. Bhd. (‘PPOM’). There was 

no effect on the equity interest held by the Company subsequent to the subscription. 

On 29 October 2009, PPOM issued 10,000,000 RCPS of RM1 each which were subscribed equally by the Company 

and CBIP. The remaining 10,000,000 RCPS of RM1 each to be issued by PPOM and subscribed equally by the 

Company and CBIP is disclosed as capital commitments in Note 39 to the financial statements. 

(b) Details of the jointly controlled entity are as follows: 

Country of Interest in equity 

Name of company incorporation held by the Company Principal activity 

2010 2009 

% % 

Pride Palm Oil Mill Sdn. Bhd. Malaysia 50 50 Investment holding 

(c) The summarised financial information of the jointly controlled entity is as follows: 

Assets and liabilities 

Group 

2010 2009 

RM’000 RM’000 

Current assets 19,788 14,186 

Non-current assets 91,583 98,121 

Total assets 111,371 112,307 

Current liabilities 34,393 22,860 

Non-current liabilities 50,000 65,000 

Total liabilities 84,393 87,860 

Results 


Income 58,083 19,653 

Expenses, including finance costs and tax expense (55,552) (31,410) 



165

166 




12. OTHER INVESTMENTS 

Group RM’000 

2010 

Non-current 

At fair value: 

Available-for-sale financial assets 

Quoted shares in Malaysia 1,032 

Unquoted shares in Malaysia 868 

Group RM’000 

2009 

Non-current 

At cost: 

Quoted shares in Malaysia 2,312 

Unquoted shares in Malaysia 486 



1,900 

2,798 

Less: Impairment loss 

- Quoted shares (1,630) 

- Unquoted shares (243) 

(1,873) 

Market value of quoted shares in Malaysia 683 

(a) The comparative figures have not been presented based on the new categorisation of financial assets resulting from 

the adoption of FRS 139 by virtue of the exemption given in FRS 7.44AA. 

(b) Information on the fair value hierarchy is disclosed in Note 36(d). 

925

13. GOODWILL ON CONSOLIDATION 

At cost 

Group 

2010 2009 

RM’000 RM’000 

Balance as at 1 January/31 December 26,848 26,848 

Accumulated impairment loss 

Balance as at 1 January/31 December (1,294) (1,294) 

Carrying amount 25,554 25,554 

Goodwill on consolidation arises mainly from the plantation segment of the Group. 

For the purpose of impairment testing, the recoverable amount of a Cash Generating Unit (‘CGU’) is based on its value in 

use determined by discounting the pre-tax cash flows based on financial projections approved by management covering up 

to 25 years which represents the full life cycle period of the oil palms. 

(a) Key assumptions used in value in use calculations 

The key assumptions on which management has based its cash flow projections to undertake impairment testing of 

goodwill are: 

(i) Discount rate of 5.00% representing the pre-tax cost of debt of the Group as at 31 December 2010. 

(ii) Fresh fruit bunches yield ranging from 8 to 28 MT/hectare obtained from the Malaysian Palm Oil Board published 

average yield applicable to the age of the respective estates and also based on management’s best estimates on 

the estate’s performance after taking into account existing achievements. 

(iii) Crude palm oil prices ranging from RM2,500 to RM2,700 per metric tonne and palm kernel prices ranging from 

RM1,500 to RM1,625 per metric tonne. 

(iv) Oil extraction rate ranging from 21.00% to 21.65% and kernel extraction rate ranging from 5.00% to 5.60% 

based on management’s best estimates after taking into account the age of the respective estates and existing 

achievements. 

(v) Average increase in plantation maintenance expenses of 1% to 3% per hectare. 




167

168 




13. GOODWILL ON CONSOLIDATION (continued) 

(a) Key assumptions used in value in use calculations (continued) 

Based on these calculations, the Directors are of the view that no additional impairment loss is required during the 

financial year as the recoverable amount determined is higher than the carrying amounts of the CGUs. 

(b) Sensitivity to changes in assumptions 

The management believes that there is no reasonably possible change in the key assumptions on which management 

has based its determination of the CGU’s recoverable amount which would cause the CGU’s carrying amount to 

materially exceed its recoverable amount. 

14. INVENTORIES 



Group 

2010 2009 

RM’000 RM’000 

At cost 

Oil palm products 20,726 29,302 

Consumables 11,443 12,047 

Nurseries 7,868 15,541 

Cattle 2,467 3,027 

42,504 59,917 

At net realisable value 

Cattle 767 694 

43,271 60,611 

The write-down of inventories to net realisable value amounted to RM209,000 (2009: RM173,000) and is included in the 

statements of comprehensive income.

15. TRADE AND OTHER RECEIVABLES 


Group Company 

2010 2009 2010 2009 

RM’000 RM’000 RM’000 RM’000 

Trade receivables 

Third parties 101,884 68,367 - - 

Related parties 8,852 27,166 - - 

Related company 4,027 4,282 - - 

Subsidiary of the jointly controlled entity 2,228 873 - - 

116,991 100,688 - - 

Other receivables, deposits and prepayments 

Amounts owing by subsidiaries - - 646,645 576,561 

Amount owing by a related company 13 1 12 - 

Amount owing by a subsidiary 

of a jointly controlled entity 11,951 1,320 11,856 1,307 

Amount owing by an associate - 893 - - 

Other receivables 5,821 6,808 159 348 

Deposits 1,681 877 346 81 

Prepayments 903 519 355 - 

20,369 10,418 659,373 578,297 

137,360 111,106 659,373 578,297 

(a) The credit terms offered by the Group in respect of trade receivables range from 7 to 30 days (2009: 7 to 30 days) 

from date of invoice. 

(b) The amounts owing by related parties, a related company and a subsidiary of the jointly controlled entity in trade 

receivables are subject to normal trade terms. 



169

170 




15. TRADE AND OTHER RECEIVABLES (continued) 

(c) The amounts owing by subsidiaries in other receivables comprise the following: 



Company 

2010 2009 

RM’000 RM’000 

Advances to subsidiaries (interest bearing) 604,863 532,098 

Due from subsidiaries 43,618 46,299 

Less: Impairment loss (1,836) (1,836) 

41,782 44,463 

646,645 576,561 

The advances to subsidiaries are unsecured, bear interest at 5.50% (2009: 5.20% to 5.50%) per annum at the end of 

the reporting period and are payable on demand in cash and cash equivalents. 

The amounts due from subsidiaries are unsecured, interest-free and payable on demand in cash and cash equivalents. 

(d) The amount owing by a related company in other receivables is unsecured, interest-free and payable on demand in 

cash and cash equivalents. 

(e) The amount owing by a subsidiary of a jointly controlled entity in other receivables is unsecured, interest-free and 

payable on demand in cash and cash equivalents. 

(f) The amount owing by an associate in other receivables in the previous financial year was unsecured, interest-free and 

payable on demand in cash and cash equivalents.

15. TRADE AND OTHER RECEIVABLES (continued) 

(g) The ageing analysis of trade receivables of the Group at the end of the reporting period is as follows: 



Group 

2010 

RM’000 

Neither past due nor impaired 94,862 

1 to 30 days past due but not impaired 16,644 



More than 90 days past due but not impaired 52 

Receivables that are neither past due nor impaired 

22,129 

116,991 

Trade receivables that are neither past due nor impaired are creditworthy debtors with good payment records with the 

Group. 

None of the trade receivables of the Group that are neither past due nor impaired have been renegotiated during the 

financial year. 

Receivables that are past due but not impaired 


The Group has trade receivables amounting to RM22,129,000 that are past due at the end of the reporting period but 

not impaired as these receivables arose from creditworthy debtors with no history of default in payments. 

171

172 




16. CASH AND CASH EQUIVALENTS 



Group Company 

2010 2009 2010 2009 

RM’000 RM’000 RM’000 RM’000 

Fixed deposits with licensed banks 1,554 1,955 - - 

Short term deposits 58,000 46,500 58,000 46,500 

Islamic deposits 6,725 5,447 - - 

66,279 53,902 58,000 46,500 

Cash and bank balances 12,066 9,837 8,395 5,006 

As reported in statements of financial position 78,345 63,739 66,395 51,506 

Less: Fixed deposits pledged to licensed banks (1,554) (1,955) - - 

Less: Islamic deposits held on trust for the benefit 

of the Islamic Debt Securities Investors (6,725) (5,447) - - 

As reported in statements of cash flows 70,066 56,337 66,395 51,506 

The fixed deposits were pledged to licensed banks for banking facilities granted to certain subsidiaries. 

The Islamic deposits comprise one profit payment for Islamic Debt Securities of RM6,725,000 (2009: RM5,447,000) and 

are held in trust by the facility trustee for the benefit of the Islamic Debt Securities Investors. 

The annual interest rates for deposits that were effective at the end of the reporting period were as follows: 

Group Company 

2010 2009 2010 2009 

% % % % 

Deposits with licensed banks 2.44 - 2.80 1.90 - 2.10 2.70 - 2.75 1.90 - 1.95 

Deposits of the Group and of the Company have a maturity period of 4 to 365 days (2009: 6 to 365 days). Bank balances 

are deposits held at call with banks. 

Information on repricing analysis of deposits are disclosed in Note 37(i) to the financial statements.

17. NON-CURRENT ASSETS HELD FOR SALE 

Property, plant and equipment 

Group 

2010 2009 

RM’000 RM’000 

Transfer from property, plant and equipment (Note 7) 

- Cost - 5,500 

- Accumulated depreciation - (4,716) 

Carrying amount as at 31 December - 784 

On 7 December 2009, the Group had agreed to dispose certain plant and machinery with a carrying amount of RM784,000 

to a third party for a cash consideration of RM1,500,000. On 4 January 2010, the Group entered into a Sale and Purchase 

agreement with the third party for the disposal. The disposal was completed during the financial year and the gain arising 

from the disposal amounted to RM716,000. 

18. SHARE CAPITAL 


Group and Company 

2010 2009 

Number Number 

of shares of shares 

’000 RM’000 ’000 RM’000 

Ordinary shares of RM1.00 each: 

Authorised 1,000,000 1,000,000 1,000,000 1,000,000 

Issued and fully paid 529,153 529,153 529,153 529,153 

The holders of ordinary shares are entitled to receive dividend as and when declared by the Company and are entitled to 

one (1) vote per ordinary share at general meetings of the Company. All ordinary shares rank pari passu with regard to 

the Company’s residual assets. 



173

19. RESERVES 

174 






Group Company 

2010 2009 2010 2009 

RM’000 RM’000 RM’000 RM’000 

Non-distributable: 

Share premium 316,155 316,155 316,155 316,155 

Available-for-sale reserve 975 - - - 

ICULS - equity component 133,657 133,657 133,657 133,657 

450,787 449,812 449,812 449,812 

Distributable: 

Retained earnings 540,840 398,091 100,736 111,945 

(a) Available-for-sale reserve 

Fair value gains or losses arising on financial assets classified as available-for-sale. 

(b) Retained earnings 

991,627 847,903 550,548 561,757 

Effective 1 January 2008, the Company is given the option to make an irrevocable election to move to a single tier 

system or to continue to use its tax credit under Section 108 of the Income Tax Act, 1967 for the purpose of dividend 

distribution until the tax credit is fully utilised or latest, by 31 December 2013. 

The Company has decided not to make this election and has sufficient tax credit under Section 108 of the Income 

Tax Act, 1967 to frank dividend payments of approximately RM99,743,000 out of its retained earnings as at 31 

December 2010. The remaining retained earnings of RM993,000 can be distributed as exempt dividends under 

the single tier system. In the previous financial year, the Company has sufficient Section 108 tax credit to distribute 

the entire retained earnings as at 31 December 2009 as dividend without incurring any additional tax liability. The 

Section 108 tax credit is subject to the agreement of the Inland Revenue Board.

19. RESERVES (continued) 

(c) Supplementary information on realised and unrealised profits or losses 

The retained earnings as at end of the financial year are analysed as follows: 


2010 

Group Company 

RM’000 RM’000 

Total retained earnings of the Company and its subsidiaries: 

- Realised 813,329 100,941 

- Unrealised (81,482) (205) 

731,847 100,736 

Total share of accumulated losses from a jointly controlled entity: 

- Realised (1,274) - 

- Unrealised (237) - 

(1,511) - 

730,336 100,736 

Less: Consolidation adjustments (189,496) - 

Total Group’s/Company’s retained earnings as per 

consolidated financial statements 540,840 100,736 



175

176 




20. OTHER PAYABLE 

Company 

This represents advances from a subsidiary which are unsecured and bear interest at rates ranging from 4.45% to 5.70% 

(2009: 4.95% to 5.70%) per annum at the end of the reporting period. 

The amount owing to the subsidiary is repayable by instalments of varying amounts over the following periods: 



2010 2009 

RM’000 RM’000 

1 - 2 years 128,116 35,000 

2 - 3 years 30,000 30,000 

3 - 4 years 30,000 30,000 

4 - 5 years 45,000 30,000 

More than 5 years 10,159 54,553 

243,275 179,553 

Information on repricing analysis of amount owing to a subsidiary are disclosed in Note 37(i) to the financial statements.

21. BORROWINGS 


Group Company 

2010 2009 2010 2009 

RM’000 RM’000 RM’000 RM’000 

Revolving credits 

- secured (Note 22) 156,000 175,000 156,000 175,000 

- unsecured 75,000 80,000 69,000 70,000 

231,000 255,000 225,000 245,000 

Term loans - secured (Note 23) 103,212 80,212 - - 

Islamic Debt Securities - secured (Note 25) 35,000 75,000 - - 

ICULS (Note 24) 3,553 3,352 3,553 3,352 


372,765 413,564 228,553 248,352 

Term loans - secured (Note 23) 233,570 321,574 - - 

Islamic Debt Securities - secured (Note 25) 250,000 185,000 - - 

ICULS (Note 24) 17,230 20,783 17,230 20,783 

Total borrowings 


500,800 527,357 17,230 20,783 

Revolving credits 231,000 255,000 225,000 245,000 

Term loans (Note 23) 336,782 401,786 - - 

Islamic Debt Securities (Note 25) 285,000 260,000 - - 

ICULS (Note 24) 20,783 24,135 20,783 24,135 

873,565 940,921 245,783 269,135 



177

178 




22. REVOLVING CREDITS - SECURED 

Revolving credits of the Group and of the Company are secured by way of legal charges over certain leasehold land and 

plantations of a subsidiary (as disclosed in Note 7 to the financial statements). 

The annual interest rates for revolving credits that were effective at the end of the reporting period were as follows: 



Group Company 

2010 2009 2010 2009 

% % % % 

Revolving credits 3.73 - 4.54 2.92 - 3.97 3.73 - 3.95 2.92 - 3.74 

Information on repricing analysis of revolving credits are disclosed in Note 37(i) to the financial statements. 

23. TERM LOANS - SECURED 

Term loans of the Group are secured by way of: 

(i) fixed charges over certain leasehold land, buildings, plant and machinery and plantations of certain subsidiaries (as 

disclosed in Note 7 to the financial statements); and 

(ii) corporate guarantees by the Company. 

The term loans bear interest at 3.90% to 6.50% (2009: 3.21% to 6.50%) per annum at the end of the reporting period. 

The term loans are repayable by instalments of varying amounts over the following periods: 

Group 

2010 2009 

RM’000 RM’000 

Less than 1 year 103,212 80,212 

1 - 2 years 70,520 103,212 

2 - 3 years 67,050 70,662 

3 - 4 years 26,506 60,700 

4 - 5 years 31,008 26,506 


Information on repricing analysis of term loans are disclosed in Note 37(i) to the financial statements. 

336,782 401,786

24. IRREDEEMABLE CONVERTIBLE UNSECURED LOAN STOCkS (‘ICULS’) 

On 25 May 2004, the Company, Tradewinds (M) Berhad (‘TWS’) and Johore Tenggara Oil Palm Berhad (‘JTOP’) entered 

into a Merger Agreement where TWS and JTOP agreed to undertake and implement a scheme of amalgamation of 

companies and a merger exercise to consolidate and rationalise the oil palm businesses of TWS and JTOP (‘the Merger’) 

through the Company, as a special purpose vehicle set up to facilitate the implementation of the Merger. The Merger was 

completed on 28 February 2006. 

Pursuant to the completion of the Merger, the Company issued RM160,000,000 nominal value 10-year 3% ICULS on 28 

February 2006. The ICULS were listed on the Main Market of Bursa Malaysia Securities Berhad on 15 March 2006. 

The ICULS bear coupon at a fixed rate of 3.0% per annum payable annually in arrears. The ICULS are not redeemable and 

will be convertible into new ordinary shares on any market day commencing from the third (3 rd ) anniversary from the date 

of issuance of the ICULS by tendering the ICULS on the basis of RM1.60 nominal value of the ICULS for every one (1) new 

ordinary share of RM1 each in the Company. 

The liability component of ICULS recognised in the statements of financial position are as follows: 


2010 2009 

RM’000 RM’000 

Balance as at 1 January 24,135 27,297 

Interest expense 1,448 1,638 

Interest payable (4,800) (4,800) 

Balance as at 31 December (Note 21) 20,783 24,135 

Repayable as follows: 

Current liabilities (Note 21) 3,553 3,352 

Non-current liabilities (Note 21) 17,230 20,783 

20,783 24,135 

Interest expense on the ICULS is calculated on the effective yield basis by applying the effective interest rate of 6% (2009: 

6%) for an equivalent non-convertible loan stock to the liability component of the ICULS. 

Information on repricing analysis of ICULS are disclosed in Note 37(i) to the financial statements. 




179

180 




25. ISLAMIC DEBT SECURITIES - SECURED 



Group 

2010 2009 

RM’000 RM’000 

Current liability 

Sukuk Ijarah 35,000 25,000 

Murabahah Commercial Papers/Medium Term Notes (‘Murabahah CP/MTN’) - 50,000 

35,000 75,000 

Non-current liability 

Sukuk Ijarah 150,000 185,000 

Murabahah CP/MTN 100,000 - 

The Islamic Debt Securities comprise the following: 

250,000 185,000 

285,000 260,000 

(a) RM210,000,000 Sukuk Ijarah which was issued on 18 December 2007, of which RM25,000,000 was redeemed 

during the financial year; and 

(b) Up to RM190,000,000 Murabahah Commercial Papers/Medium Term Notes Programme. 

The Islamic Debt Securities are secured by first and second legal charges over the freehold land, leasehold land, plantations 

and palm oil mills owned by certain subsidiaries (as disclosed in Note 7 to the financial statements). 

The Sukuk Ijarah and Murabahah CP/MTN bear profit rate of 4.95% to 5.70% and 4.45% to 4.55% (2009: 4.85% to 

5.70% and 5.50%) per annum respectively at the end of the reporting period.

25. ISLAMIC DEBT SECURITIES - SECURED (continued) 

The Islamic Debt Securities are repayable by instalments of varying amounts over the following periods: 

Group 

2010 2009 

RM’000 RM’000 

Less than 1 year 35,000 75,000 

1 - 2 years 130,000 35,000 

2 - 3 years 30,000 30,000 

3 - 4 years 30,000 30,000 

4 - 5 years 45,000 30,000 


285,000 260,000 

Information on repricing analysis of Islamic Debt Securities are disclosed in Note 37(i) to the financial statements. 

26. DEFERRED TAX 

Recognised deferred tax assets and liabilities 


Deferred tax assets and liabilities are offset when there is a legally enforceable right to set off current tax assets against 

current tax liabilities and when the deferred taxes relate to the same taxation authority. 

The following amounts, determined after appropriate offsetting, are shown in the statements of financial position: 

Group Company 

2010 2009 2010 2009 

RM’000 RM’000 RM’000 RM’000 

Deferred tax assets 19,465 22,543 4,991 5,826 

Deferred tax liabilities (324,711) (322,101) - - 



181



26. DEFERRED TAX (continued) 

182 


Recognised deferred tax assets and liabilities (continued) 

(a) Movements in deferred tax during the financial year are as follows: 



Group Company 

2010 2009 2010 2009 

RM’000 RM’000 RM’000 RM’000 

Balance as at 1 January (299,558) (274,138) 5,826 6,588 

Recognised in statements of 

comprehensive income (Note 31) 

- liability portion of ICULS (838) (790) (838) (790) 

- unabsorbed tax losses 2,934 (239) - - 

- unutilised capital and agriculture allowances 17,179 7,841 - - 

- other deductible temporary differences 24 17 31 13 

- excess of capital and agriculture allowances 

over corresponding depreciation (33,696) (17,191) (28) 15 

- crystallisation of deferred tax on fair value 

adjustment of property, plant and equipment 8,709 7,996 - - 

(5,688) (2,366) (835) (762) 

Arising from acquisition of a subsidiary (Note 34) 

- fair value adjustment of property, plant 

and equipment - (23,054) - - 

Balance as at 31 December (305,246) (299,558) 4,991 5,826


Recognised deferred tax assets and liabilities (continued) 

(b) The components of deferred tax assets and liabilities at the end of the financial year comprise the tax effects of: 

Deferred tax assets 

Group Company 

2010 2009 2010 2009 

RM’000 RM’000 RM’000 RM’000 

Liability portion of ICULS 5,196 6,034 5,196 6,034 

Unabsorbed tax losses 43,739 40,805 - - 

Unutilised capital and agriculture allowances 111,847 94,668 - - 

Other deductible temporary differences 134 110 125 94 

Deferred tax assets (before offsetting) 160,916 141,617 5,321 6,128 

Offsetting (141,451) (119,074) (330) (302) 

Deferred tax assets (after offsetting) 19,465 22,543 4,991 5,826 

Deferred tax liabilities 


Excess of capital and agriculture allowances over 

corresponding depreciation (234,639) (200,943) (330) (302) 

Fair value adjustment on property, plant and 

equipment (231,523) (240,232) - - 

Deferred tax liabilities (before offsetting) (466,162) (441,175) (330) (302) 

Offsetting 141,451 119,074 330 302 

Deferred tax liabilities (after offsetting) (324,711) (322,101) - - 



183

184 





Unrecognised deferred tax assets 

The amounts of temporary differences for which no deferred tax assets have been recognised in the statements of financial 

position are as follows: 



Group 

2010 2009 

RM’000 RM’000 

Unabsorbed tax losses 73,199 60,161 

Unutilised capital and agriculture allowances 4,796 3,387 

77,995 63,548 

Deferred tax assets of certain subsidiaries have not been recognised in respect of these items as it is not probable that 

taxable profit will be available against which the deductible temporary differences can be utilised. 

The deductible temporary differences do not expire under the current tax legislation.

27. TRADE AND OTHER PAYABLES 

Trade payables 

Group Company 

2010 2009 2010 2009 

RM’000 RM’000 RM’000 RM’000 

Third parties 47,096 64,426 - - 

Related party - 260 - - 

Other payables 


47,096 64,686 - - 

Amount owing to holding company 411 741 411 740 

Amounts owing to subsidiaries - - 487,837 425,940 

Amount owing to a related company 135 150 - 103 

Amount owing to a subsidiary of a jointly controlled entity 6 10 - - 

Amounts owing to minority shareholders 14,415 14,415 - - 

Other payables 52,936 50,497 3,220 920 

Accruals 33,807 13,315 3,676 1,208 

Interest payable on ICULS 4,000 4,000 4,000 4,000 

105,710 83,128 499,144 432,911 

152,806 147,814 499,144 432,911 

(a) The credit terms available to the Group in respect of trade payables range from 30 to 90 days (2009: 30 to 90 days) 

from date of invoice. 

(b) The amount due to a related party in trade payables in the previous financial year was subject to normal trade terms. 

(c) The amount owing to holding company in other payables is unsecured, interest-free and payable on demand in cash 

and cash equivalents. 



185

186 




27. TRADE AND OTHER PAYABLES (continued) 

(d) The amounts owing to subsidiaries comprise the following: 



Company 

2010 2009 

RM’000 RM’000 

Advances from subsidiaries (interest bearing) 482,497 420,780 

Due to subsidiaries 5,340 5,160 

487,837 425,940 

The advances from subsidiaries in other payables are unsecured, bear interest at 2.75% (2009: 2.00% to 5.50%) 

per annum at the end of the reporting period except for an amount of RM35,000,000 (2009: RM25,000,000) 

which bears interest at 4.95% (2009: 4.85%) per annum. The advances are payable on demand in cash and cash 

equivalents. 

The amounts due to subsidiaries in other payables are unsecured, interest-free and payable on demand in cash and 

cash equivalents. 

(e) The amount owing to a related company in other payables is unsecured, interest-free and payable on demand in cash 

and cash equivalents. 

(f) The amount owing to a subsidiary of a jointly controlled entity in other payables is unsecured, interest-free and payable 

on demand in cash and cash equivalents. 

(g) The amounts owing to minority shareholders in other payables are unsecured, interest-free and payable on demand in 

cash and cash equivalents.

28. REVENUE 

Group Company 

2010 2009 2010 2009 

RM’000 RM’000 RM’000 RM’000 

Sales of goods 903,521 675,010 - - 

Gross dividend income from subsidiaries - - 52,172 46,088 

Management fees 3,684 2,414 8,210 9,597 

Property development revenue 1,921 - - - 

29. STAFF COSTS 

Included in staff costs of the Group and of the Company are: 


909,126 677,424 60,382 55,685 

Group Company 

2010 2009 2010 2009 

RM’000 RM’000 RM’000 RM’000 

Defined contribution plan 4,977 4,842 1,086 985 

Termination benefits 177 - - - 



187

188 




30. PROFIT BEFORE TAX 



Group Company 

2010 2009 2010 2009 

(Restated) 

RM’000 RM’000 RM’000 RM’000 

Profit before tax is arrived at after charging: 

Auditors’ remuneration: 

- statutory: 

- current year 410 392 47 45 

- (over)/under-provision in prior year (1) 6 - - 

Company Directors’ remuneration: 

- fees 290 156 195 65 

- other emoluments 644 448 644 448 

- benefits-in-kind 25 25 25 25 

Other Directors’ remuneration: 

- fees 243 226 - - 

- other emoluments 4 4 - - 

- benefits-in-kind 3 - - - 

Depreciation of property, plant and equipment (Note 7) 101,974 94,060 1,224 1,248 

Contribution for Albukhary International University - 10,000 - - 

Finance costs: 

- subsidiaries - - 24,940 22,669 

- ICULS 1,448 1,638 1,448 1,638 

- term loans 12,968 13,343 - - 

- revolving credits 5,967 5,639 5,815 5,489 

- Sukuk Ijarah 1,963 4,917 - - 

- Murabahah CP/MTN 4,760 5,036 - - 

Impairment loss on: 

- other receivables - 90 - - 

- investment in a subsidiary - - - 100 

Inventories written down 209 173 - - 

Loss on disposal of property, plant and equipment - 2 - - 

Property, plant and equipment written off 875 177 806 - 

Realised loss on commodity swap - 2,813 - - 

Rental of premises 1,374 985 729 170

30. PROFIT BEFORE TAX (continued) 

And crediting: 

Group Company 

2010 2009 2010 2009 

(Restated) 

RM’000 RM’000 RM’000 RM’000 

Reversal of impairment loss on: 

- quoted shares - 76 - - 

- unquoted shares - 105 - - 

Gross dividend income from subsidiaries - - 52,172 46,088 

Gain on disposal of non-current assets held for sale 716 648 - - 

Gain on disposal of property, plant and equipment 822 136 173 - 

Gain on liquidation of an associate - 1,183 - - 

Finance income: 

- subsidiaries - - 30,459 29,778 

- others 598 441 393 113 

Rental income 786 1,238 - - 

31. TAX EXPENSE 

Current tax expense based on results for 

the financial year: 


Group Company 

2010 2009 2010 2009 

RM’000 RM’000 RM’000 RM’000 

- Malaysian income tax 67,734 25,359 3,368 3,111 

- (Over)/Under-provision of tax expense in prior year (2,970) (3,772) 129 (21) 

64,764 21,587 3,497 3,090 

Deferred tax (Note 26): 

- Current year 9,401 2,836 816 764 

- (Over)/Under-provision in prior year (3,713) (470) 19 (2) 

5,688 2,366 835 762 

Total tax expense 70,452 23,953 4,332 3,852 



189

190 




31. TAX EXPENSE (continued) 

Malaysian income tax is calculated at the statutory tax rate of 25% (2009: 25%) of the estimated taxable profits for the 

fiscal year. 

The subsidiary in Singapore is not liable to Singapore tax as the subsidiary is not a tax residence of Singapore. 

The numerical reconciliation between the tax expense and the product of accounting profit multiplied by the applicable tax 

rates of the Group and of the Company are as follows: 



Group Company 

2010 2009 2010 2009 

RM’000 RM’000 RM’000 RM’000 

Tax at Malaysian statutory tax rate of 25% (2009: 25%) 70,602 19,587 9,195 10,156 

Tax effect in respect of: 

Non-allowable expenses 4,657 4,134 1,616 768 

Current year loss and capital allowances not 

eligible for carry forward 171 1,111 170 1,110 

Deferred tax assets not recognised 3,612 3,408 - - 

Non-taxable income - (905) (6,797) (8,159) 

Lower tax rates (743) (610) - - 

Tax incentive (848) - - - 

Share of result of a jointly controlled entity (316) 1,470 - - 

77,135 28,195 4,184 3,875 

(Over)/Under-provision of tax expense in prior year (2,970) (3,772) 129 (21) 

(Over)/Under-provision of deferred tax in prior year (3,713) (470) 19 (2) 

Tax expense for the financial year 70,452 23,953 4,332 3,852 

In the current and previous financial year, there are no tax savings for the Group and for the Company arising from the 

utilisation of current year tax losses and previously unrecognised unused tax losses.

32. EARNINGS PER ORDINARY SHARE ATTRIBUTABLE TO OWNERS OF THE PARENT 

Basic earnings per ordinary share 

Basic earnings per ordinary share of the Group is calculated by dividing the profit attributable to owners of the parent for 

the financial year by the weighted average number of ordinary shares in issue during the financial year and assuming the 

ICULS (as disclosed in Note 24 to the financial statements) have been converted into ordinary shares. 

Group 

2010 2009 

Profit attributable to owners of the parent (RM’000) 186,404 51,545 

Weighted average number of ordinary shares in issue (’000) 529,153 529,153 

Adjustments assuming the conversion of ICULS (’000) 100,000 100,000 

629,153 629,153 

Basic earnings per ordinary share (sen) 29.63 8.19 

Diluted earnings per ordinary share 


Diluted earnings per ordinary share is not applicable and not presented because there are no dilutive potential ordinary 

shares to be issued as the ICULS have been included in basic earnings per ordinary share calculation. 



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192 




33. DIVIDEND 




2010 2009 

RM’000 RM’000 

Final gross dividend of 6.00 sen per ordinary share, less tax at 25%, 

(4.50 sen net per ordinary share) in respect of financial year 2009, 

paid in financial year 2010 23,812 - 

Interim gross dividend of 5.00 sen per ordinary share, less tax at 25%, 


paid in financial year 2010 19,843 - 

Final gross dividend of 6.00 sen per ordinary share, less tax at 25%, 


paid in financial year 2009 - 23,812 

43,655 23,812 

A final gross dividend in respect of the financial year ended 31 December 2010 of 5.00 sen per ordinary share, less tax 

at 25%, amounting to RM19,843,254 (3.75 sen net per ordinary share) has been proposed by the Board of Directors after 

the reporting period for shareholders’ approval at the forthcoming Annual General Meeting. The financial statements for the 

current financial year do not reflect this proposed dividend. This proposed dividend, if approved by shareholders, will be 

accounted for as an appropriation of retained earnings in the financial year ending 31 December 2011.

34. ACQUISITION OF SUBSIDIARIES 

2010 

On 9 June 2010, the Company’s wholly-owned subsidiary, Johore Tenggara Oil Palm Berhad (‘JTOP’), acquired the 

remaining 60% equity interest in Hak JTOP Sdn. Bhd. (‘Hak JTOP’) for a cash consideration of RM3,200,000. Consequently, 

Hak JTOP became a wholly-owned subsidiary of JTOP. 

The effect of the acquisition on the financial results of the Group during the financial year was as follows: 



2010 

RM’000 

Revenue - 

Loss for the period (23) 

There is no material effect to the Group’s revenue and profit for the year if the acquisition had occurred on 1 January 2010. 

The acquisition had the following effect on the Group’s assets and liabilities on acquisition date: 


Acquiree’s 

carrying 

amount 

RM’000 

Property, plant and equipment - 

Other payables (92) 

Total net assets (92) 

Fair value 

recognised on 

acquisition 

RM’000 

Property, plant and equipment 3,292 

Other payables (92) 

Group’s share of net assets/Purchase consideration discharged by cash 3,200 

193

194 




34. ACQUISITION OF SUBSIDIARIES (continued) 

2009 

(a) On 21 August 2009, the Company entered into a conditional Sale and Purchase Agreement with Gerak Mashyur 

(Malaysia) Sdn. Bhd. (‘GMSB’) for the acquisition of 700,000 ordinary shares of RM1 each, representing 70% 

equity interest of Northern Intergrated Agriculture Sdn. Bhd. (‘NIA’) for a total cash consideration of RM50,360,000. 

The purchase consideration was adjusted to RM49,315,000 upon the completion of assessment of the acquiree’s 

identifiable assets, liabilities, and contingent liabilities based on due diligence report. 

NIA is a property development company incorporated in Malaysia and was established as a joint venture vehicle 

between GMSB and Perbadanan Kemajuan Negeri Kedah to undertake the development of the second border town 

between Malaysia and Thailand known as ‘Bandar Sempadan Kota Putra’. 

NIA owns five (5) parcels of leasehold agriculture land located at Kota Putra, Mukim Batang Tunggang Kiri, Daerah 

Padang Terap, Negeri Kedah measuring in aggregate approximately 2,612.99 acres (‘NIA Lands’) of which 169.44 

acres had been surrendered to the Government following completion of their project in November 2008. 

1,115.02 acres of the NIA Lands had been planted with rubber trees whilst an approved master plan for the 

development of Bandar Sempadan Kota Putra had been obtained for the remaining land. 

The acquisition of NIA was completed on 23 October 2009. 

The effect of the acquisition on the financial results of the Group for the previous financial year was as follows: 



2009 

RM’000 

Revenue - 

Profit for the period 1,073 

If the acquisition had occurred on 1 January 2009, the Group’s revenue and profit for the previous financial year 

would have been RM679,985,000 and RM55,680,000 respectively.

34. ACQUISITION OF SUBSIDIARIES (continued) 

2009 (continued) 

(a) The acquisition had the following effect on the Group’s assets and liabilities on acquisition date: 


Fair value 

Acquiree’s recognised 

carrying on 

amount acquisition 

RM’000 RM’000 

Property, plant and equipment 103 103 

Leasehold land 3,313 12,265* 

Land held for property development 4,148 87,412* 

Other receivables 26 26 

Fixed deposit with a licensed bank 1,429 1,429 

Cash and bank balances 3,037 3,037 

Trade and other payables (7,869) (7,869) 

Current tax payable (729) (729) 

Deferred tax liabilities - (23,054) 

Total net assets 3,458 72,620 

Less: Minority interest (21,786) 

Group’s share of net assets 50,834 

Excess of fair value of net assets acquired over purchase consideration (1,519) 

Adjusted purchase consideration discharged by cash 49,315 

Less: Cash and cash equivalents acquired (3,037) 

Cash out flow on acquisition, net of cash and cash equivalents acquired 46,278 

* The fair values of leasehold land and land held for property development were based on valuation performed by 

an independent valuer, Hakimi & Associates Sdn. Bhd. on 2 August 2009. 

(b) On 26 October 2009, the Company acquired the entire equity interest of Prisma Spektra Sdn. Bhd. (‘PSSB’) for a cash 

consideration of RM2. PSSB is an investment holding company. 

The assets acquired and liabilities assumed as at the date of acquisition, the effect of the acquisition on the financial 

results of the Group and the financial results to the Group if the acquisition had occurred on 1 January 2009 were not 

material in relation to the Group’s assets and liabilities and financial results for the previous financial year. 



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35. OPERATING SEGMENTS 

The Group’s operations primarily comprise cultivation of oil palm and rubber trees, processing of palm oil and provision of 

plantation management and advisory services (‘Plantation Business’) and property development. 

In the previous financial year, no segmental information had been prepared as the results from property development activities 

were not significant and therefore the results of the Group for the previous financial year were derived predominantly from 

the Plantation Business. 

Following the adoption of FRS 8 – Operating Segments, the Group has arrived at three reportable segments that are 

organised and managed separately according to the nature of the products and services, specific expertise and technologies 

requirements, which requires different business and marketing strategies. The reportable segments are summarised as 

follows: 

(i) Plantation 

Cultivation of oil palm and rubber trees, processing of palm oil and provision of plantation management and advisory 

services. 

(ii) Property development 

Development of residential and commercial properties. 

(iii) Investment holding 

Group-level corporate services, treasury functions and investing activities. 

Other non-reportable segment comprises dormant subsidiaries and subsidiaries which have ceased business operations. 

The Group evaluates performance on the basis of profit or loss from operations before tax not including non-recurring losses, 

such as restructuring costs. 

Transfer prices between operating segments are on an arm’s length basis in a manner similar to transactions with third 

parties. 

Segment assets exclude tax assets and segment liabilities exclude tax liabilities. 


Annual Report 2010

35. OPERATING SEGMENTS (continued) 


Investment 

Property Holding/ 

Plantation Development Others Elimination Consolidated 

RM’000 RM’000 RM’000 RM’000 RM’000 

2010 

Revenue 

Revenue from external customers 907,205 1,921 - - 909,126 

Inter-segment revenue - - 57,446 (57,446) - 

Total revenue 907,205 1,921 57,446 (57,446) 909,126 

Segment results 297,227 458 32,693 - 330,378 

Share of results of a jointly controlled entity 1,266 - - - 1,266 

298,493 458 32,693 - 331,644 

Less: Inter-segment dividend income (49,236) 

Profit before tax 282,408 

Assets 

Segment assets 2,793,569 87,412 97,415 - 2,978,396 

Investment in a jointly controlled entity 13,489 - - - 13,489 

2,807,058 87,412 97,415 - 2,991,885 

Tax assets 23,294 

Total assets 3,015,179 

Liabilities 

Segment liabilities 470,624 3,113 552,634 - 1,026,371 

Tax liabilities 344,569 

Total liabilities 1,370,940 



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Investment 



RM’000 RM’000 RM’000 RM’000 RM’000 

2010 (continued) 

Other segment information: 

Addition to non-current assets other 

than financial instruments and 

deferred tax assets 211,557 - 2,553 - 214,110 

Depreciation and amortisation 100,631 - 1,343 - 101,974 

Finance income 9,943 - 31,015 (40,360) 598 

Finance costs 34,944 - 32,522 (40,360) 27,106 

2009 (restated) 

Revenue 

Revenue from external customers 677,424 - - - 677,424 

Inter-segment revenue - - 31,848 (31,848) - 

Total revenue 677,424 - 31,848 (31,848) 677,424 

Segment results 88,790 1,519 16,168 - 106,477 

Share of results of a jointly controlled entity (5,879) - - - (5,879) 

82,911 1,519 16,168 - 100,598 

Less: Inter-segment dividend income (22,251) 

Profit before tax 78,347


Investment 



RM’000 RM’000 RM’000 RM’000 RM’000 

2009 (restated) (continued) 

Assets 

Segment assets 2,689,388 87,412 70,795 - 2,847,595 

Investment in a jointly controlled entity 12,223 - - - 12,223 

2,701,611 87,412 70,795 - 2,859,818 

Tax assets 29,103 

Total assets 2,888,921 

Liabilities 

Segment liabilities 536,661 3,303 548,771 - 1,088,735 

Tax liabilities 324,863 

Total liabilities 1,413,598 

Other segment information: 

Addition to non-current assets other 

than financial instruments and 

deferred tax assets 186,450 87,412 499 - 274,361 

Depreciation and amortisation 92,695 - 1,365 - 94,060 

Finance income 7,063 - 30,084 (36,706) 441 

Finance costs 37,152 - 30,127 (36,706) 30,573 

Information about major customers 


Sales to three major customers in the plantation segment during the financial year amounted to RM414,530,000 (2009: 

RM356,778,000 from two major customers). 



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36. FINANCIAL INSTRUMENTS 

(a) Capital management 

The primary objective of the Group’s capital management is to ensure that the Group maintains healthy capital ratios 

in order to support its business operations and maximises shareholders value. 

The Group manages its capital structure and makes adjustments to it, in light of changes in economic conditions. To 

maintain or adjust the capital structure, the Group may adjust the dividend payment to shareholders, return capital to 

shareholders or issue new shares. No changes were made in the objectives, policies or processes during the financial 

years ended 31 December 2010 and 31 December 2009. 

The Group monitors capital using a gearing ratio which is the amount of borrowings (Note 21 to the financial 

statements) divided by equity attributable to owners of the parent. The Group’s policy is to keep the gearing ratio within 

manageable levels. At the end of the reporting period, the Group’s gearing ratio is 0.57 times (2009: 0.68 times). 

With respect to the banking facilities with certain financial institutions and the Sukuk Ijarah and Murabahah CP/MTN 

facilities, the Group is committed to maintain a gearing ratio of not more than 1.75 times calculated by dividing the 

amount of borrowings (Note 21 to the financial statements) over equity attributable to owners of the parent. 

(b) Financial instruments 

Certain comparative figures have not been presented for the financial year ended 31 December 2009 by virtue of the 

exemption given in paragraph 44AA of FRS 7. 

(i) Categories of financial instruments 

Loans and Available- 

Group receivables for-sale Total 

2010 RM’000 RM’000 RM’000 

Financial assets 

Other investments - 1,900 1,900 

Trade and other receivables 137,360 - 137,360 

Cash and cash equivalents 78,345 - 78,345 



215,705 1,900 217,605

36. FINANCIAL INSTRUMENTS (continued) 

(b) Financial instruments (continued) 

(i) Categories of financial instruments (continued) 


Other 

financial 

Group liabilities Total 

2010 RM’000 RM’000 

Financial liabilities 

Trade and other payables 152,806 152,806 

Borrowings 873,565 873,565 

1,026,371 1,026,371 

Loans and 

Company receivables Total 

2010 RM’000 RM’000 

Financial assets 

Other receivables 659,373 659,373 

Cash and cash equivalents 66,395 66,395 

725,768 725,768 

Other 

financial 

liabilities Total 

RM’000 RM’000 

Financial liabilities 

Other payables 742,419 742,419 

Borrowings 245,783 245,783 

988,202 988,202 



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202 





(c) Fair values 

The fair values of financial instruments that are not carried at fair value and whose carrying amounts do not approximate 

their fair values are as follows: 

2010 2009 

Carrying Fair Carrying Fair 

Group amount value amount value 

Note RM’000 RM’000 RM’000 RM’000 

Recognised 

Unquoted investments 12 * * 243 116 

Term loans with fixed interest rates 37(i) 107,282 106,133 144,136 139,862 

Sukuk Ijarah 37(i) 185,000 186,074 210,000 214,391 

Murabahah CP/MTN 37(i) 100,000 100,529 - - 

2010 2009 

Carrying Fair Carrying Fair 

Company amount value amount value 

Note RM’000 RM’000 RM’000 RM’000 

Recognised 

Amount owing to a subsidiary 37(i) 278,275 279,903 204,553 208,882 

* In the previous financial year, the Group’s unquoted investments were stated at cost less accumulated impairment 

loss. In the current financial year, the Group’s unquoted investments have been categorised as available-for-sale 

financial assets, resulting from the adoption of FRS 139, and are measured at fair value. 


Annual Report 2010


(c) Fair values (continued) 

Methods and assumptions used to estimate fair value of financial instruments 

(i) Financial instruments that are not carried at fair value and whose carrying amounts are at reasonable approximation 

of fair value. 

The carrying amounts of financial assets and liabilities, such as cash and cash equivalents, receivables, payables 

and borrowings, are reasonable approximation of fair value, either due to their relatively short term nature or 

that they are floating rate instruments that are re-priced to market interest rates on or near the end of the reporting 

period. 

The fair values of borrowings are estimated based on future contractual cash flows discounted at market lending 

rate for similar types of lending or borrowing arrangements at the end of the reporting period. 

The fair value of the liability component of ICULS is determined by discounting the future contractual cash flows 

of interest payments at the prevailing market rate for equivalent non-convertible loan stocks. 

(ii) Amount owing to a subsidiary and borrowings with fixed interest rate and are accounted for as long term 

financial liabilities. 

The fair values of these financial instruments are estimated based on future contractual cash flows discounted at 

market lending rate for similar types of lending or borrowing arrangements at the end of the reporting period. 

(iii) Quoted shares 

Fair value is determined directly by reference to their published market bid price at the end of the reporting 

period. 

(iv) Unquoted shares 

Fair value is estimated using a relative valuation technique based on the price earnings ratio of a public listed 

entity with similar business activities obtained from the market, discounted by 20% to reflect its listing premium. 

Management believes that the estimated fair value resulting from this valuation technique is reasonable and the 

most appropriate at the end of the reporting period. 

(v) Financial guarantees 


The Company provides guarantees to lenders for financing facilities extended to certain subsidiaries. The fair 

value of such financial guarantees is negligible as the probability of the subsidiaries defaulting on the financing 

facilities is remote. 



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204 





(d) Fair value hierarchy 

The following table provides an analysis of financial instruments that are measured subsequent to initial recognition at 

fair value, grouped into Levels 1 to 3 based on the degree to which the fair value is observable. 

Level 1 fair value measurements are those derived from quoted prices (unadjusted) in active markets for identical assets 

or liabilities. 

Level 2 fair value measurements are those derived from inputs other than quoted prices included within Level 1 that are 

observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices). 

Level 3 fair value measurements are those derived from inputs for the asset or liability that are not based on observable 

market data (unobservable inputs). 

As at 31 December 2010, the Group held the following financial instruments carried at fair value in the consolidated 

statement of financial position: 

Assets measured at fair value 



31 December 

2010 Level 1 Level 2 Level 3 

RM’000 RM’000 RM’000 RM’000 

Available-for-sale financial assets 

- Quoted shares 1,032 1,032 - - 

- Unquoted shares 868 - - 868 

During the reporting period ended 31 December 2010, there were no transfers between Level 1 and Level 3 fair value 

measurement. 

37. FINANCIAL RISk MANAGEMENT OBJECTIVES AND POLICIES 

The Group’s financial risk management objective is to optimise value creation for shareholders whilst minimising the potential 

adverse impact arising from fluctuations in interest rate risk, credit risk, liquidity and cash flow risk, and market price risk. 

The exposure to these risks arises in the normal course of the Group’s business. The Group’s overall business strategies, 

its tolerance of risk and its general risk management philosophy are determined by the management in accordance with 

prevailing economic and operating conditions. The Group is exposed mainly to interest rate risk, credit risk, liquidity and 

cash flow risk, and market price risk. Information on the management of the related exposures are detailed below.

37. FINANCIAL RISk MANAGEMENT OBJECTIVES AND POLICIES (continued) 

(i) Interest rate risk 

Interest rate risk is the risk that the fair value of future cash flows of the Group’s and of the Company’s financial 

instruments will fluctuate because of changes in market interest rates. 

The Group’s exposure to changes in interest rates relates primarily to the Group’s deposits with banks and interest 

bearing debt obligations. The Group does not use derivative financial instruments to hedge its risk but regularly 

reviews its debt portfolio to enable it to source low interest funding. The Group’s deposits are placed at fixed rates and 

management endeavours to obtain the best rate available in the market. 

Sensitivity analysis for interest rate risk 

At 31 December 2010, if interest rates had been 50 basis points lower/higher, with all other variables held constant, 

the Group’s and the Company’s post-tax profit for the year would have been RM1,504,000 and RM626,000 higher/ 

lower respectively, arising mainly as a result of lower/higher finance costs on floating rate borrowings and higher/ 

lower finance income on deposits. The assumed movement in basis points for interest rate sensitivity analysis is based 

on a prudent estimate of the current market environment. 

Effective interest rates and repricing analysis 

The following tables set out the carrying amounts, the weighted average effective interest rates as at the end of the 

reporting period and the remaining maturities of the Group’s and the Company’s financial instruments that are exposed 

to interest rate risk: 

Weighted 

average 

effective Within 1 - 2 2 - 3 3 - 4 4 - 5 More than 

interest rate 1 year years years years years 5 years Total 

Group Note (per annum) RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 

% 

At 31 December 2010 


Fixed rates 

Deposits with licensed banks 16 2.69 66,279 - - - - - 66,279 

Term loans 23 5.81 (39,462) (24,270) (43,550) - - - (107,282) 

Sukuk Ijarah 25 5.23 (35,000) (30,000) (30,000) (30,000) (45,000) (15,000) (185,000) 

Murabahah CP/MTN 25 4.50 - (100,000) - - - - (100,000) 

ICULS (liability component) 24 3.00 (3,553) (3,766) (3,992) (4,232) (4,485) (755) (20,783) 

Floating rates 

Revolving credits 22 3.83 (231,000) - - - - - (231,000) 

Term loans 23 4.32 (229,500) - - - - - (229,500) 



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206 





(i) Interest rate risk (continued) 

Effective interest rates and repricing analysis (continued) 



to interest rate risk: (continued) 

Weighted 

average 



Group Note (per annum) RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 

% 


Fixed rates 


Term loans 23 5.76 (36,712) (39,462) (24,412) (43,550) - - (144,136) 

Sukuk Ijarah 25 5.22 (25,000) (35,000) (30,000) (30,000) (30,000) (60,000) (210,000) 

ICULS (liability component) 24 3.00 (3,352) (3,553) (3,766) (3,992) (4,232) (5,240) (24,135) 


Murabahah CP/MTN 25 5.50 (50,000) - - - - - (50,000) 


Term loans 23 3.72 (257,650) - - - - - (257,650) 


Annual Report 2010


(i) Interest rate risk (continued) 

Effective interest rates and repricing analysis (continued) 



to interest rate risk: (continued) 

Weighted 

average 



Company Note (per annum) RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 

% 


Fixed rates 


Amount owing to a subsidiary 20 4.97 - (128,116) (30,000) (30,000) (45,000) (10,159) (243,275) 

ICULS (liability component) 24 3.00 (3,553) (3,766) (3,992) (4,232) (4,485) (755) (20,783) 

Amount owing to a subsidiary 27 4.95 (35,000) - - - - - (35,000) 


Amounts owing by subsidiaries 15 5.50 604,863 - - - - - 604,863 

Amounts owing to subsidiaries 27 2.75 (447,497) - - - - - (447,497) 




Fixed rates 


Amount owing to a subsidiary 20 5.22 - (35,000) (30,000) (30,000) (30,000) (54,553) (179,553) 

ICULS (liability component) 24 3.00 (3,352) (3,553) (3,766) (3,992) (4,232) (5,240) (24,135) 

Amount owing to a subsidiary 27 4.85 (25,000) - - - - - (25,000) 


Amounts owing by subsidiaries 15 5.49 532,098 - - - - - 532,098 

Amounts owing to subsidiaries 27 2.44 (395,780) - - - - - (395,780) 




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(ii) Credit risk 

Cash deposits and trade receivables may give rise to credit risk which requires the loss to be recognised if a counter 

party fails to perform as contracted. The management monitors exposure to credit risk on an ongoing basis via 

management reporting procedures and action is taken to recover debts when due. 

Exposure to credit risk 

At the end of the reporting period, the maximum exposure to credit risk for the Group and for the Company are 

represented by the carrying amount of each class of financial assets recognised in the statements of financial position. 

Credit risk concentration profile 

As at 31 December 2010, other than the amounts owing by three major customers of the Group constituting 46.9% 

(2009: 61.6%) of the total receivables of the Group and the amounts owing by subsidiaries constituting 98.1% 

(2009: 99.7%) of the total receivables of the Company, there were no significant concentrations of credit risk. 

Financial assets that are neither past due nor impaired 

Information regarding trade receivables that are neither past due nor impaired is disclosed in Note 15 to the financial 

statements. Deposits, cash and bank balances placed with financial institutions that are neither past due nor impaired 

are placed with major financial institutions in Malaysia with high credit ratings and no history of default. 

Financial assets that are past due but not impaired 

Information regarding trade receivables that are past due but not impaired is disclosed in Note 15 to the financial 

statements. 

(iii) Liquidity and cash flow risk 

The Group actively manages its debt maturity profile, operating cash flows and the availability of funding so as to 

ensure that all operating, investing and financing needs are met. In liquidity risk management strategy, the Group 

measures and forecasts its cash commitments and maintains a level of adequate credit facilities to finance its working 

capital. In addition, the Group carries out treasury management to optimise the cash flow utilisation of the Group 

where applicable. 


Annual Report 2010


(iii) Liquidity and cash flow risk (continued) 

The table below summarises the maturity profile of the Group’s and the Company’s liabilities at the end of the reporting 

period based on contractual undiscounted repayment obligations: 

On demand 

or within 1 - 5 Over 5 

1 year years years Total 

Group RM’000 RM’000 RM’000 RM’000 

Financial liabilities: 

Trade and other payables 152,806 - - 152,806 

Loans and borrowings 372,765 494,333 60,374 927,472 

Total undiscounted financial liabilities 525,571 494,333 60,374 1,080,278 

Company 

Financial liabilities: 

Trade and other payables 499,144 254,167 10,690 764,001 

Loans and borrowings 228,553 19,200 4,800 252,553 

Total undiscounted financial liabilities 727,697 273,367 15,490 1,016,554 

(iv) Market price risk 

The Group is exposed to equity price risk arising from its investment in quoted shares. These quoted shares are listed 

on Bursa Malaysia Securities Berhad and are classified as available-for-sale financial assets. 

In the normal course of business of the Group, there are exposures to price fluctuation on commodities particularly for 

palm oil. The Group mitigates its risk to the price volatility through constant monitoring on the movement of oil palm 

product prices. 

Sensitivity analysis for equity price risk 


At 31 December 2010, if the market value of the quoted investments had been 5% higher/lower, with all other 

variables held constant, the Group’s available-for-sale reserve would have been RM52,000 higher/lower, arising as 

a result of an increase/decrease in the fair value of these quoted shares. 



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210 




38. RELATED PARTY DISCLOSURES 

(a) Identities of related parties 

For the purpose of these financial statements, parties are considered to be related to the Group if the Group has the 

ability, directly or indirectly, to control the party or exercise significant influence over the party in making financial 

and operating decisions, or vice versa, or where the Group and the party are subject to common control or common 

significant influence. Related parties may be individuals or other entities. 

Related parties of the Company include: 

(i) Tradewinds (M) Berhad, the holding company; 

(ii) Direct and indirect subsidiaries of the holding company; 

(iii) Direct and indirect associates, jointly controlled entities and affiliates of the holding company; and 

(iv) Key management personnel are defined as those persons having authority and responsibility for planning, 

directing and controlling the activities of the Group either directly or indirectly. The key management personnel 

includes all the Directors of the Company, and certain members of senior management of the Group. 

The Group has related party relationships with the following parties: 

(i) Retus Plantation Sdn. Bhd. (‘RPSB’) 

RPSB is a 60% subsidiary of the holding company. 

(ii) Agri-Sabah Fertilizer Sdn. Bhd. (‘ASFSB’) 

ASFSB, in which PPB Oil Palms Berhad (‘PPBOPB’) has a 6.92% equity interest. PPBOPB is a wholly-owned 

subsidiary of Wilmar International Limited (‘WIL’), a company in which PPB Group Berhad (‘PPB’) has an 18.3% 

equity interest. 

PPB was deemed as a major shareholder of the Company until 5 January 2010 by virtue of its direct and 

indirect equity interests in FFM Berhad, Grenfell Holdings Sdn. Bhd., Hexarich Sdn. Bhd., Cathay Enterprises Sdn. 

Bhd., Taloh Sdn. Bhd. and the holding company. With effect from 6 January 2010, PPB ceased to be a major 

shareholder of the Company pursuant to the completion of the disposal by Grenfell Holdings Sdn. Bhd. of its 20% 

equity instruments in the holding company to Felda Global Ventures Holdings Sdn. Bhd. 

(iii) Bintulu Edible Oils Sdn. Bhd. (‘BEOSB’) 

BEOSB is a wholly-owned subsidiary of PGEO Group Sdn. Bhd. (‘PGEOGSB’). PGEOGSB is a wholly-owned 

subsidiary of WIL, a company in which PPB has 18.3% equity interest. 


Annual Report 2010

38. RELATED PARTY DISCLOSURES (continued) 

(a) Identities of related parties (continued) 

The Group has related party relationships with the following parties: (continued) 

(iv) Lahad Datu Edible Oils Sdn. Bhd. (‘LDEOSB’) 

LDEOSB is an associated company of PGEOGSB. 

(v) JP Logistics Sdn. Bhd. (‘JPLSB’) 

JPLSB is a wholly-owned subsidiary of Johor Port Berhad (‘JPB’). JPB is a wholly-owned subsidiary of MMC 

Corporation Berhad (‘MMCCB’) of which Seaport Terminal (Johore) Sdn. Bhd. (‘STJSB’) is a major shareholder 

holding 51.76% of the equity interest in MMCCB. 

Tan Sri Dato’ Seri Syed Mokhtar Shah bin Syed Nor is deemed a major shareholder of the Company by virtue of 

his direct and indirect equity interest in Restu Jernih Sdn. Bhd., Kelana Ventures Sdn. Bhd., Indra Cita Sdn. Bhd. 

and STJSB. 

Restu Jernih Sdn. Bhd. is deemed a major shareholder of the Company by virtue of its interest in Perspective Lane 

(M) Sdn. Bhd., who is a major shareholder of the holding company having direct shareholdings of 30.04%. 

Kelana Ventures Sdn. Bhd. is also a major shareholder of the holding company having direct shareholdings of 

8.86%. 

(vi) Tradewinds International Insurance Brokers Sdn. Bhd. (‘TIIBSB’) 

TIIBSB is a company in which a major shareholder of the holding company, Tan Sri Dato’ Seri Syed Mokhtar Shah 

bin Syed Nor, has indirect interest. 

(vii) Solar Green Sdn. Bhd. (‘SGSB’) 

SGSB is a wholly-owned subsidiary of Pride Palm Oil Mill Sdn. Bhd., a jointly controlled entity of the Company. 

(viii) Felda Marketing Services Sdn. Bhd. (‘FMSSB’) and Felda Agricultural Services Sdn. Bhd. (‘FASSB’) 

FMSSB and FASSB are subsidiaries of Felda Holdings Berhad (‘Felda Holdings’). 


Felda Global Ventures Holdings Sdn. Bhd., who is deemed as a major shareholder of the Company with effect 

from 6 January 2010, has 49% equity interest in Felda Holdings. 



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212 





(b) Significant related party transactions 

In addition to the transactions detailed elsewhere in the financial statements, the Group and the Company had the 

following transactions with related parties during the financial year: 



Group Company 

2010 2009 2010 2009 

RM’000 RM’000 RM’000 RM’000 

Interests paid and payable to subsidiaries - - 24,940 22,669 

Insurance premium paid to Tradewinds International 

Insurance Brokers Sdn. Bhd. 2,639 2,621 342 317 

Purchase of raw materials from Agri-Sabah Fertilizer 

Sdn. Bhd. - 6,660 - - 

Purchase of germinated oil palm seeds from Felda 

Agricultural Services Sdn. Bhd. 423 - - - 

Sales of fresh fruit bunches to: 

- Solar Green Sdn. Bhd. 17,954 1,231 - - 

- Retus Plantation Sdn. Bhd. 7,114 3,233 - - 

Sales of crude palm oil and palm kernel to: 

- Bintulu Edible Oils Sdn. Bhd. - 100,641 - - 

- Lahad Datu Edible Oils Sdn. Bhd. - 49,547 - - 

- Felda Marketing Services Sdn. Bhd. 58,846 - - - 

Provision of transportation services from 

JP Logistics Sdn. Bhd. 341 409 - - 

Interests received and receivable from subsidiaries - - 30,459 29,778 

Interest on ICULS payable to holding company 4,800 4,800 4,800 4,800 

Management fees paid and payable to 

holding company 1,200 1,200 1,200 1,200 

Management fees received and receivable from: 

- subsidiaries - - 8,210 9,597 

- Retus Plantation Sdn. Bhd. 2,660 2,207 - - 

- Solar Green Sdn. Bhd. 989 207 - - 

Dividend received from subsidiaries - - 52,172 48,871 

The related party transactions described above were carried out based on negotiated terms and conditions and 

mutually agreed with respective related parties.


(c) Compensation of key management personnel 

The remuneration of key management personnel (including Directors of the Company) during the financial year was as 

follows: 

Group Company 

2010 2009 2010 2009 

RM’000 RM’000 RM’000 RM’000 

Short term employee benefits 4,526 4,332 2,854 2,327 

Defined contribution plan 492 516 289 259 

Termination benefits 177 - - - 

39. CAPITAL COMMITMENTS 


Group Company 

2010 2009 2010 2009 

RM’000 RM’000 RM’000 RM’000 

Purchase of property, plant and equipment: 

- Approved but not contracted for 93,062 96,947 1,779 2,566 

- Approved and contracted for 145,144 74,804 - - 

238,206 171,751 1,779 2,566 

Acquisition of a subsidiary: 

- Approved and contracted for (Note 42) 140,000 150,000 - - 

Subscription of redeemable convertible preference 

shares in a jointly controlled entity: 

- Approved and contracted for (Note 11) 5,000 5,000 5,000 5,000 

Share of capital commitment of a jointly 

controlled entity: 

- Approved and contracted for 379 - - - 

383,585 326,751 6,779 7,566 



213

214 




40. CONTINGENT LIABILITIES (UNSECURED) 

The Company had guaranteed the financing facilities of certain subsidiaries for RM623,250,000 (2009: RM706,950,000) 

of which the outstanding balance is RM526,950,000 (2009: RM548,000,000). 

41. SIGNIFICANT EVENTS DURING THE FINANCIAL YEAR 

(a) On 30 December 2009, the Company had submitted applications to the Companies Commission of Malaysia (‘CCM’) 

to strike off from CCM’s register its wholly-owned dormant subsidiaries, namely Gugusan Induk Sdn. Bhd. (‘GISB’), 

Insan Delima Sdn. Bhd. (‘IDSB’), JTOP Lebir Plantation Sdn. Bhd. (‘JTOP Lebir’) and Teon Choon Quarry Sdn. Bhd. 

(‘TCQSB’), under Section 308 of the Companies Act, 1965. 

During the current financial year, the Company received the following striking-off notices from the CCM pursuant to the 

application for the striking-off: 




Accordingly, GISB and JTOP Lebir were struck-off from CCM’s register on 7 September 2010 and TCQSB and IDSB 

were struck-off from CCM’s register on 17 September 2010 and 13 October 2010 respectively. 

(b) On 9 June 2010, the Company’s wholly-owned subsidiary, Johore Tenggara Oil Palm Berhad (‘JTOP’), acquired 

the remaining 60% equity interest in Hak JTOP Sdn. Bhd. (‘Hak JTOP’) for a cash consideration of RM3,200,000. 

Consequently, Hak JTOP became a wholly-owned subsidiary of JTOP. 

42. SIGNIFICANT EVENTS SUBSEQUENT TO THE END OF THE REPORTING PERIOD 

On 30 October 2009, Prisma Spektra Sdn. Bhd. (‘PSSB’), a wholly-owned subsidiary of the Company, entered into a 

conditional Share Sale Agreement (‘SSA’) with Semi Bayu Sdn. Bhd. (‘SBSB’) for the acquisition of 125,709,000 ordinary 

shares of RM1 each in MARDEC Berhad (‘Mardec’), representing the entire issued and paid-up ordinary share capital of 

Mardec, for a total purchase consideration of RM150,000,000 (‘Proposed Acquisition of Mardec’). 

Mardec is an investment holding company incorporated in Malaysia and through its local and overseas subsidiaries and 

associates, is involved in the processing and trading of natural rubber and the manufacturing of value-added rubber and 

polymer products. 

The initial period for the fulfillment and satisfaction of the conditions precedent to the Proposed Acquisition of Mardec 

(‘Prescribed Period’) expired on 29 April 2010. On 30 April 2010, SBSB and PSSB agreed to extend the Prescribed Period 

by a further period of six months to 30 October 2010. On 1 November 2010, the Prescribed Period was extended by a 

further period of six months to 30 April 2011. 


Annual Report 2010

42. SIGNIFICANT EVENTS SUBSEQUENT TO THE END OF THE REPORTING PERIOD (continued) 

On 25 February 2011, PSSB and SBSB entered into a supplemental agreement to revise the purchase consideration for 

the Proposed Acquisition of Mardec as provided in the SSA from RM150,000,000 to RM140,000,000, which shall be 

payable in the following manner: 

(i) a first instalment of RM42,000,000 or 30% of the revised purchase consideration to be paid on the completion date; 

and 

(ii) a second instalment of RM98,000,000 or 70% of the revised purchase consideration to be paid within 3 months of 

the completion date. 

The revised purchase consideration is arrived at based on Ernst & Young’s appraisal of the fair value of the Mardec Group 

by using the Hybrid Methodology, which is a combination of Income and Asset Approaches of valuation, which ranges 

between RM130,000,000 and RM150,000,000. 

The Proposed Acquisition of Mardec is pending the approvals of the shareholders of the Company at a general meeting to 

be convened and the Economic Planning Unit of the Prime Minister’s Department. 

43. COMPARATIVES 

Certain figures as at 1 January 2009 have been restated due to the effects arising from the adoption of Amendment to 

FRS 117 Leases, which have resulted in retrospective adjustments. Leasehold land held by the Group for own use were 

reclassified from prepaid lease payments for land as previously reported, to property, plant and equipment - leasehold land. 

Effect of 

As adoption of 

previously Amendment As 

Group reported to FRS 117 restated 

RM’000 RM’000 RM’000 

As at 1 January 2009 

Statement of Financial Position 

Property, plant and equipment 1,276,032 1,132,293 2,408,325 

Prepaid lease payments for land 1,132,293 (1,132,293) - 

As at 31 December 2009 


Statement of Financial Position 

Property, plant and equipment 1,369,910 1,127,554 2,497,464 

Prepaid lease payments for land 1,127,554 (1,127,554) - 



215

216 




43. COMPARATIVES (continued) 

Effect of 

As adoption of 

previously Amendment As 

Group reported to FRS 117 restated 

RM’000 RM’000 RM’000 

For the financial year ended 31 December 2009 

Statement of Comprehensive Income 

Depreciation of property, plant and equipment 77,120 16,940 94,060 

Amortisation of prepaid lease payments for land 16,940 (16,940) - 

Statement of Cash Flows 

Depreciation of property, plant and equipment 77,120 16,940 94,060 

Amortisation of prepaid lease payments for land 16,940 (16,940) - 

Gain on disposal of property, plant and equipment 49 87 136 

Gain on disposal of prepaid lease payments for land 87 (87) - 

Proceeds from disposal of property, plant and equipment 116 151 267 

Proceeds from disposal of prepaid lease payments for land 151 (151) - 


Annual Report 2010

44. OPENING STATEMENT OF FINANCIAL POSITION 

The opening statement of financial position as at 1 January 2010, primarily reflecting the effects arising from the adoption 

of FRS 139, is as follows: 

As Effect of 

previously adoption of As 

Group reported FRS 139 restated 

RM’000 RM’000 RM’000 

ASSETS 

Non-current assets 

Property, plant and equipment 2,497,464 - 2,497,464 

Land held for property development 87,412 - 87,412 

Investment in a jointly controlled entity 12,223 - 12,223 

Other investments 925 (126) 799 

Goodwill on consolidation 25,554 - 25,554 

Deferred tax assets 22,543 - 22,543 

Current assets 


2,646,121 (126) 2,645,995 

Inventories 60,611 - 60,611 

Trade and other receivables 111,106 - 111,106 

Tax recoverable 6,560 - 6,560 

Cash and cash equivalents 63,739 - 63,739 

242,016 - 242,016 

Non-current assets held for sale 784 - 784 

TOTAL ASSETS 2,888,921 (126) 2,888,795 



217

218 




44. OPENING STATEMENT OF FINANCIAL POSITION (continued) 

As Effect of 

previously adoption of As 

Group reported FRS 139 restated 

RM’000 RM’000 RM’000 

EQUITY AND LIABILITIES 

Equity attributable to owners of the parent 

Share capital 529,153 - 529,153 

Reserves 847,903 (126) 847,777 

1,377,056 (126) 1,376,930 

Minority interest 98,267 - 98,267 

TOTAL EQUITY 1,475,323 (126) 1,475,197 

LIABILITIES 


Borrowings 527,357 - 527,357 

Deferred tax liabilities 322,101 - 322,101 




849,458 - 849,458 

Trade and other payables 147,814 - 147,814 

Borrowings 413,564 - 413,564 

Current tax payable 2,762 - 2,762 

564,140 - 564,140 

TOTAL LIABILITIES 1,413,598 - 1,413,598 

TOTAL EQUITY AND LIABILITIES 2,888,921 (126) 2,888,795

PLANTATION REvIEW 

OIL PALM 

2010 2009 2008 2007 2006# 

Fresh Fruit Bunches (FFB) (tonnes) 1,191,685 1,196,876 1,197,026 1,160,994 978,759 

Yield per Mature Hectare (tonnes FFB)* 16.92 16.87 16.91 16.90 14.73 

Mill Production (tonnes) 

– Crude Palm Oil 250,726 250,406 238,893 219,349 186,744 

– Palm Kernel 62,283 62,743 60,786 57,105 46,074 

Extraction Rate (%) 

– Crude Palm Oil 21.54 21.20 20.71 19.94 20.06 

– Palm Kernel 5.35 5.31 5.27 5.19 4.95 

Average Selling Price (RM per tonne) 

– Crude Palm Oil 2,705 2,174 2,692 2,187 1,493 

– Palm Kernel 1,713 1,029 1,534 1,394 840 

Hectarage 

– Mature 70,166 69,885 70,254 67,763 66,896 

– Immature 20,940 14,530 12,859 15,067 13,520 

# Represents 10 months performance as the Group was only established on 28 February 2006. 

* Yield per hectare is based on average mature hectare. 

OTHER INFORMATION 



219

LOcATION Of THE gROuP 

ESTATES AND PALm OIL mILLS 

GUA MUSANG 

• Serasa 

• Sg. Bayu 

• Relai Group 

• Serasa Mill 

220 


KUALA NERANG 

• Sg. Ahning 

• Bukit Ketapang 

• Durian Burung 

• Batu Hitam 

• Sg. Seraya 

• Tanah Merah 

• Sg. Tekai 

KLUANG 

• Pakloh 

• Pelangi 

• Sembrong Kiri 

SERIAN/GEDONG 

• Gemilang 

• Melur 

• Sg. Krang 

• Sg. Mangga 

• Tg. Melano 

• Sg. Tersak 

• Melur Gemilang Mill 

KULAI 

• Air Manis 



KEMAMAN 

• Mawar 

• Sawit Cherul 

• Ibok 

• Perkasa 

• Angkasa 

• Chendana 

• Bukit Sah 

DARO 

• Tanjung Alan 1 

• Tanjung Alan 2 

SIMUNJAN 

• Simunjan 

• Sebuyau 

• Ladong 

KOTA TINGGI 

• Agromaju 

• Ulu Sebol A 

• Ulu Sebol B 

• Penawar 

• Jaya 

• Ulu Papan 

• Sisek 

• Sg. Kachur 

• Sg. Lebak 

• Semai Segar 

• Sg. Kachur Mill 

• Ulu Sebol Mill 

MATU 

• Jemoreng 1 

• Jemoreng 2 

BETONG 

• Lingga 

SIBU 

• Pelitanah 1 

• Pelitanah 2 

MUKAH 

• Judan 

• Petian 

• Judan Mill 

MIRI 

• Kuala Suai 

• Tanjung Payung 

• Sungai Klad 

• Sibuti 

• Binu 

• Jelai 

• Mutiara 

• Binu Mill 

LAWAS 

• Trusan 

• Intan 

• Merapok 

• Trusan Mill 

SANDAKAN 

• Batu Putih 

• Tinabau 

• Batu Putih Mill 

LAHAD DATU 

• Permai 

• Tengah Nipah 

• Permai Mill

mATERIAL PROPERTIES Of 

TRADEWINDS PLANTATION BERHAD gROuP 

Company/ 

Location/Address 

TRADEWINDS CORRIDOR 

SDN BHD 

Ladang Sg. Tekai 

Ladang Sg. Seraya 

Ladang Batu Hitam 

Ladang Tanah Merah 

Ladang Sg. Ahning & 

Ladang Bukit Ketapang 

HS(D) 1/87 and 2/87 

PT No. 245 and 246 

Mukim Padang Terap Kiri 

District of Padang Terap, Kedah 

HS(D) 5/92 and 9/92 

PT No. 334 to 338 



HS(D) 235 and 237 

PT No. 692 to 694 



HS(D) 253, PT No. 1286 



HS(D) 249 to 250 

PT No. 776 to 777 

Mukim Padang Terap Kanan 


HS(D) 1/92 to 2/92 

PT No. 229 to 230 

Mukim Padang Terap Kanan 


HS(D) 10/92 to 14/92 

PT No. 351 to 355 

Mukim Batang Tunggang Kiri 


HS(D) 4 to 7 

PT No. 379 to 283 



Description Area 

(Hectares) 

Oil Palm and 

Rubber 


Oil Palm and 

Rubber 


Oil Palm and 

Rubber 


Oil Palm and 

Rubber 


Oil Palm and 

Rubber 


Oil Palm and 

Rubber 


Oil Palm and 

Rubber 


Oil Palm and 

Rubber 


1,328.87 

354.89 

661.44 

140.11 

35.79 

817.68 

1,402.88 

792.65 

Existing 

Use 









Leasehold for a term 

of 60 years expiring 

on 26.11.2055 



on 26.11.2055 



on 26.11.2055 



on 26.11.2063 



on 13.4.2063 



on 26.11.2055 



on 26.11.2055 



on 26.11.2055 


Tenure Net carrying 

amount as at 

31.12.2010 

RM’000 

297,196 18.3.2008 



Date of 

acquisition 

221

222 




Company/ 


HS(D) 238 to 244 

PT No. 695 to 701 



HS(D) 253 to 260 

PT No. 421 to 428 



HS(D) 252, PT No. 879 



HS(D) 2 to 3 

PT No. 136 to 152 

Mukim Batang Tunggang Kanan 


HS(D) 15/92, PT No. 1468 

Mukim Pedu 


HS(D) 16/92 to 18/92 

PT No. 1476 to 1478 

Mukim Pedu 


HS(D) 1, PT No. 1569 

Mukim Pedu 


HS(D) 19/92, PT No. 4479 

Mukim Tekai 


HS(D) 1/89, PT No. 4278 

Mukim Tekai 


HS(D) 158/89, PT No. 4279 

Mukim Tekai 


HS(D) 408/89, PT No. 2333 

Mukim Bukit Lada 





(Hectares) 

Oil Palm and 

Rubber 


Oil Palm and 

Rubber 


Oil Palm and 

Rubber 


Oil Palm and 

Rubber 


Oil Palm and 

Rubber 


Oil Palm and 

Rubber 


Oil Palm and 

Rubber 


Oil Palm and 

Rubber 


Oil Palm and 

Rubber 


Oil Palm and 

Rubber 


Oil Palm and 

Rubber 


116.06 

19.74 

79.17 

1,327.48 

197.26 

1,633.54 

187.84 

1,447.69 

48.78 

3.14 

249.39 

Existing 

Use 













amount as at 

31.12.2010 

RM’000 



on 26.11.2055 



on 26.11.2055 



on 21.9.2063 



on 26.11.2055 



on 26.11.2055 



on 26.11.2055 



on 26.11.2055 



on 26.11.2055 



on 26.11.2055 



on 26.11.2055 



on 26.11.2055 

Date of 

acquisition

Company/ 


HS(D) 389, PT No. 805 

Mukim Kuala Nerang 


HS(D) 2158, PT No. 363 

Mukim Bandar Pokok Sena 


HS(D) 251, PT No. 1705 

Mukim Tolak 


LADANG SUNGAI RELAI 

SDN BHD 

Ladang Sg. Relai 

GM 53/99, PT 3294 

Mukim Relai 

Daerah Gua Musang, Kelantan 

GM 54/99, PT 3295 

Mukim Relai 


GM 55/99, PT 3296 

Mukim Relai 


GM 56/99, PT 3297 

Mukim Relai 


GM 57/99, PT 3298 

Mukim Relai 


GM 58/99, PT 3299 

Mukim Relai 


PT 3252, HS (D) 432 

Mukim Relai 


PT 3254, HS (D) 433 

Mukim Relai 



(Hectares) 

Oil Palm and 

Rubber 


Oil Palm and 

Rubber 


Oil Palm and 

Rubber 


Oil Palm 


Oil Palm 


Oil Palm 


Oil Palm 


Oil Palm 


Oil Palm 


Oil Palm 


Oil Palm 


7.99 

634.81 

8.38 

6.02 

12.41 

7.57 

170.12 

288.4 

4,681.10 

1,067 

2,023 

Existing 

Use 














on 26.11.2055 



on 26.11.2055 



on 21.9.2063 



on 29.11.2064 



on 29.11.2064 



on 29.11.2064 



on 29.11.2064 



on 29.11.2064 



on 29.11.2064 



on 29.11.2064 



on 29.11.2064 



amount as at 

31.12.2010 

RM’000 

99,239 27.9.1999 



Date of 

acquisition 

27.9.1999 

27.9.1999 

27.9.1999 

27.9.1999 

27.9.1999 

20.4.2000 

20.4.2000 

223

224 




Company/ 


PT 3255, HS (D) 434 

Mukim Relai 


PT 6632, HS (D) 435 

Mukim Relai 


LADANG PETRI TENGGARA 

SDN BHD 

Ladang Ulu Sebol 

PTD 4428, HS(D) 17845 

Mukim Hulu Sg. Johor 

Daerah Kota Tinggi, Johor 

PTD 4444, HS(D) 17846 

Mukim Hulu Sg Johor, 

Daerah Kota Tinggi, Johor 

LADANG PERMAI SDN BHD 

Ladang Permai & 

Ladang Tengah Nipah 

Lot No. 116291920 

Locality of Silabukan 

District of Lahad Datu, Sabah 

CL No. 115347852 

Locality of Tengah Nipah 


CL No. 115345867 

Locality of Segama 


Country Lease 115349383 






Oil Palm 


Oil Palm 


Oil Palm 


Oil Palm 


Oil Palm 


Oil Palm 


Oil Palm 


Oil Palm 


Oil Palm 


Oil Palm 





(Hectares) 

224.3 

77.96 

3,500.53 

364.21 

5,100 

194 

354 

18.05 

18.15 

17.85 

Existing 

Use 












amount as at 

31.12.2010 

RM’000 



on 29.11.2064 



on 29.11.2064 



on 26.8.2076 



on 26.8.2076 



on 31.12.2080 



on 31.12.2080 



on 31.12.2080 



on 31.12.2078 



on 31.12.2078 



on 31.12.2078 

96,931 

127,373 

Date of 

acquisition 

20.4.2000 

20.4.2000 

N/Av 

N/Av 

13.5.1984 

22.5.1995 

22.5.1995 

4.2.1999 

4.2.1999 

4.2.1999

Company/ 

























(Hectares) 

Oil Palm 


Oil Palm 


Oil Palm 


Oil Palm 


Oil Palm 


Oil Palm 


Oil Palm 


Oil Palm 


Oil Palm 


Oil Palm 


Oil Palm 


18.01 

18.10 

18.23 

18.24 

18 

18.17 

18 

18.15 

17.71 

5.948 

179.8 

Existing 

Use 














on 31.12.2078 



on 31.12.2078 



on 31.12.2078 



on 31.12.2078 



on 31.12.2078 



on 31.12.2078 



on 31.12.2078 



on 31.12.2078 



on 31.12.2078 



on 31.12.2078 



on 31.12.2094 



amount as at 

31.12.2010 

RM’000 



Date of 

acquisition 

4.2.1999 

4.2.1999 

4.2.1999 

4.2.1999 

4.2.1999 

4.2.1999 

4.2.1999 

4.2.1999 

4.2.1999 

4.2.1999 

4.2.1999 

225

226 




Company/ 


Ladang Batu Putih & 

Ladang Tinabau 

Lot No. 075104335 

Locality of Sekong 

District of Sandakan, Sabah 

Lot No. 075109385 

Locality of Sekong 


Lot No. 075359385 

Locality of Sg. Sekong 


Lot No. 075409068 

Locality of Sepagaya 


Lot No. 075409077 



Lot No. 075409086 



Lot No. 075409139 



Lot No. 075409040 



Lot No. 075409120 



Lot No. 075409059 



Oil Palm 


Oil Palm 


Oil Palm 


Oil Palm 


Oil Palm 


Oil Palm 


Oil Palm 


Oil Palm 


Oil Palm 


Oil Palm 





(Hectares) 

3,550 

1,012 

167 

16 

14 

16 

16 

16 

16 

14 

Existing 

Use 












amount as at 

31.12.2010 

RM’000 

Leasehold for a 

term of 999 years 

expiring in 2887 


of 999 years 

expiring in 2887 



on 31.12.2078 



on 31.12.2080 



on 31.12.2080 



on 31.12.2080 



on 31.12.2080 



on 31.12.2080 



on 31.12.2080 



on 31.12.2080 

Date of 

acquisition 

119,672 20.8.1993 

9.9.1993 

30.9.1993 

17.2.1994 

29.9.1993 

29.9.1993 

29.9.1993 

29.9.1993 

5.12.1993 

17.12.1994

Company/ 


Lot No. 075353374 



Lot No. 075353383 



Lot No. 075362382 



Lot No. 075409111 



KUMPULAN KRIS JATI SDN BHD 

Ladang Simunjan & 

Ladang Ladong 

Lot 737, Sebangan- 

Kepayang Land District 

Samarahan, Sarawak 







Lot 1223, Sedilu-Gedong 

Land District 


Ladang Trusan & Ladang Intan 

Lot 490 and 492 

Trusan Land District 

Limbang Division, Sarawak 

Lot 493 

Trusan Land District 

Limbang Division, Sarawak 


(Hectares) 

Oil Palm 


Oil Palm 


Oil Palm 


Oil Palm 


Oil Palm 


Oil Palm 


Oil Palm 


Oil Palm 


Oil Palm 


Oil Palm 


111 

87 

202 

15 

187 

463 

2,281 

2,187 

6,140 

446 

Existing 

Use 













on 31.12.2069 



on 31.12.2069 



on 31.12.2078 



on 31.12.2080 



on 25.1.2060 



on 19.6.2060 



on 19.6.2060 



on 19.6.2060 



on 7.8.2056 



on 30.3.2057 



amount as at 

31.12.2010 

RM’000 

104,209 

127,358 



Date of 

acquisition 

14.9.1993 

14.9.1993 

14.9.1993 

29.9.1993 

4.2.2000 

24.7.2000 

24.7.2000 

24.7.2000 

8.8.1996 

31.3.1997 

227

228 




Company/ 


MELUR GEMILANG SDN BHD 

Ladang Gemilang 

Ladang Melur 

Ladang Sg. Krang 

Ladang Tg. Melano 

Ladang Sg. Mangga & 

Ladang Sg. Tersak 


Land District, Samarahan 

Sarawak 

Lot 2978, Melikin Land District 








Sarawak 

Lot 34, Punda-Sabal 


Sarawak 

Lot 33, Punda-Sabal 


Sarawak 

BINU PLANTATIONS SDN BHD 

Ladang Binu & Ladang Jelai 

Lot 199, Bakong Land District, 

Miri, Sarawak 

Lot 111 Block 4 

Bukit Kisi Land District 

Miri, Sarawak 

AMALAN PELITA PASAI 

SDN BHD 

Ladang Pelitanah 1, 2 & 3 

Lot 16, Block D 

Oya-Dalat Land District 

Sibu, Sarawak 

Oil Palm 


Oil Palm 


Oil Palm 


Oil Palm 


Oil Palm 


Oil Palm 


Oil Palm 


Oil Palm 


Oil Palm 


Oil Palm 





(Hectares) 

7,493 

780 

280 

250 

1,650 

720 

4,420 

4,648 

584 

13,980 

Existing 

Use 












amount as at 

31.12.2010 

RM’000 



on 16.2.2060 



on 16.2.2060 



on 22.4.2062 



on 22.4.2062 



on 22.4.2062 



on 22.4.2062 



on 22.4.2062 



on 4.4.2087 



on 4.4.2087 



on 5.2.2061 

268,166 

88,003 

115,838 

Date of 

acquisition 

9.3.2000 

9.3.2000 

9.3.2000 

9.3.2000 

9.3.2000 

9.3.2000 

9.3.2000 

22.11.2000 

30.3.2001

ANALySIS Of SHAREHOLDINgS 

AS AT 25 APRIL 2011 

Authorised Capital : RM1,000,000,000 

Issued and Paid–Up Capital : RM529,153,415 

Class of Share : Ordinary Shares of RM1.00 each 

Voting Rights : One vote for each Ordinary Share held (on a poll) 

ANALYSIS BY SIZE OF SHAREHOLDINGS 

Category No. of Holders % No. of Shares % 

Less than 100 124 1.73 2,212 0.00 

100 – 1,000 3,504 49.00 3,213,324 0.61 

1,001 – 10,000 2,990 41.82 11,483,999 2.17 

10,001 – 100,000 438 6.13 12,834,472 2.43 

100,001 to less than 5% of issued shares 92 1.29 80,588,993 15.22 

5% and above of issued shares 2 0.03 421,030,415 79.57 

TOTAL 7,150 100.00 529,153,415 100.00 

ANALYSIS OF OWNERSHIP OF SHAREHOLDINGS 


No. of Holders No. of Shares Percentage (%) 

Category of Malaysian 

Malaysian 

Malaysian 

Shareholders 

Foreign 

Foreign 

Bumi Non-Bumi Bumi Non-Bumi Bumi Non-Bumi 



Foreign 

1. Individual 1,183 5,229 75 4,500,095 27,096,842 1,686,512 0.85 5.12 0.32 

2. Body Corporate 

a) Banks/Finance 9 4 0 68,000 91,300 0 0.01 0.02 0.00 

Companies 

b) Investment Trusts/ 1 0 0 2,000 0 0 0.00 0.00 0.00 

Foundation/Charities 

c) Other Types of 18 81 1 73,901,525 11,554,614 40,000 13.97 2.18 0.01 

Companies 

3. Government Agencies/ 2 0 0 5,010 0 0 0.00 0.00 0.00 

Institutions 

4. Nominees 263 252 32 377,347,915 16,354,060 16,505,542 71.31 3.09 3.12 

5. Others 0 0 0 0 0 0 0.00 0.00 0.00 

TOTAL 1,476 5,566 108 455,824,545 55,096,816 18,232,054 86.14 10.41 3.45 

229

230 




LIST OF THIRTY (30) LARGEST SHAREHOLDERS 

No. Names No. of Shares % 

1. MAYBAN NOMINEES (TEMPATAN) SDN BHD 369,153,415 69.76 

PLEDGED SECURITIES ACCOUNT FOR TRADEWINDS (M) BERHAD (414011604023) 

2. SOUTHERN INTEGRATED AGRICULTURE PROJECT SDN BHD 51,877,000 9.80 

3. PERSPECTIVE LANE (M) SDN BHD 20,834,825 3.94 

4. EFFECTIVE STRATEGY SDN BHD 9,504,000 1.80 

5. CITIGROUP NOMINEES (TEMPATAN) SDN BHD 8,884,800 1.68 

EMPLOYEES PROVIDENT FUND BOARD (PHEIM) 

6. HSBC NOMINEES (ASING) SDN BHD 6,523,500 1.23 

EXEMPT AN FOR JPMORGAN CHASE BANK, NATIONAL ASSOCIATION (NORGES BK LEND) 

7. HSBC NOMINEES (ASING) SDN BHD 2,105,000 0.40 

HSBC–FS FOR ASEAN EMERGING COMPANIES GROWTH FUND LTD 

8. TASEC NOMINEES (TEMPATAN) SDN BHD 1,648,100 0.31 

MAHFAR BIN SAIRAN 

9. GOH PHAIK LYNN 1,480,000 0.28 


MAYBAN TRUSTEES BERHAD FOR PUBLIC ITTIKAL FUND (N14011970240) 

11. CARTABAN NOMINEES (ASING) SDN BHD 1,271,400 0.24 

EXEMPT AN FOR ROYAL BANK OF CANADA (ASIA) LIMITED – CLIENTS A/C 

12. CITIGROUP NOMINEES (ASING) SDN BHD 1,253,100 0.24 

EXEMPT AN FOR MERRILL LYNCH PIERCE FENNER & SMITH INCORPORATED (FOREIGN) 

13. LEONG KOK WAH 1,105,300 0.21 

14. AMSEC NOMINEES (TEMPATAN) SDN BHD 934,600 0.18 

AMTRUSTEES BERHAD FOR APEX DANA AL-SOFI-I (UT-APEX-SOFI) 

15. HSBC NOMINEES (ASING) SDN BHD 912,500 0.17 

BNY BRUSSELS FOR POWERSHARES DWA EMERGING MARKETS TECHNICAL LEADERS PORTFOLIO 


CACEIS BANK PARIS FOR PREVOIR RENAISSANCE VIETNAM 

17. HLB NOMINEE (TEMPATAN) SDN BHD 832,500 0.16 

PLEDGED SECURITIES ACCOUNT FOR LIM CHAI BENG 

18. KENANGA NOMINEES (TEMPATAN) SDN BHD 726,300 0.14 

PLEDGED SECURITIES ACCOUNT FOR CHIN KIAM HSUNG 

19. HLB NOMINEE (TEMPATAN) SDN BHD 724,100 0.14 

PLEDGED SECURITIES ACCOUNT FOR LIM CHAI BENG 


EXEMPT AN FOR CREDIT SUISSE (SG BR–TST–ASING) 


Annual Report 2010

LIST OF THIRTY (30) LARGEST SHAREHOLDERS (CONTINUED) 


No. Names No. of Shares % 

21. UNIVERSAL TRUSTEE (MALAYSIA) BERHAD 604,600 0.11 

CIMB ISLAMIC SMALL CAP FUND 

22. MAYBAN NOMINEES (TEMPATAN) SDN BHD 598,000 0.11 

ETIQA INSURANCE BERHAD (LIFE PAR FUND) 

23. NG HWEE CHOO 563,300 0.11 


EXEMPT AN FOR HSBC PRIVATE BANK (SUISSE) S.S. (HONG KONG ACCL) 

25. YAYASAN NURUL YAQEEN 500,000 0.09 


RBS COUTTS SG FOR BEADLE GROUP LIMITED 

27. HDM NOMINEES (TEMPATAN) SDN BHD 484,500 0.09 

PLEDGED SECURITIES ACCOUNT FOR LIM CHAI BENG (M02) 


EXEMPT AN FOR CREDIT SUISSE (HK BR-TST-ASING) 

29. MUHAMMAD IQBAL BIN IDHAM 454,440 0.09 

30. MAYBAN NOMINEES (TEMPATAN) SDN BHD 

MAYBAN TRUSTEES BERHAD FOR PHEIM ASIA EX-JAPAN FUND (260366) 445,300 0.08 

TOTAL 487,831,580 92.19 



231



SUBSTANTIAL SHAREHOLDERS 

Name Direct Interest Indirect Interest 

No. of % of Issued No. of % of Issued 

Total % 

of Issued 

Shares Held Shares Shares Held Shares Shares 

Tradewinds (M) Berhad 369,153,415 69.76 - - 69.76 

Southern Integrated Agriculture Project Sdn Bhd 51,877,000 9.80 - - 9.80 

Perspective Lane (M) Sdn Bhd 20,834,825 3.94 369,153,415 69.76 (1) 73.70 

Restu Jernih Sdn Bhd - - 389,988,240 73.70 (2) 73.70 

Kelana Ventures Sdn Bhd - - 369,153,415 69.76 (3) 69.76 

Tan Sri Dato’ Seri Syed Mokhtar Shah bin Syed Nor - - 389,988,240 73.70 (4) 73.70 

Felda Global Ventures Holdings Sdn Bhd - - 369,153,415 69.76 (5) 69.76 

Notes: 

(1) Deemed interested pursuant to Section 6A of the Companies Act, 1965 (“the Act”) by virtue of its interest in Tradewinds (M) Berhad. 

(2) Deemed interested pursuant to Section 6A of the Act by virtue of its interest in Perspective Lane (M) Sdn Bhd. 

(3) Deemed interested pursuant to Section 6A of the Act by virtue of its interest in Tradewinds (M) Berhad. 

(4) Deemed interested pursuant to Section 6A of the Act by virtue of the following:– 

• his 99.99% equity interest in Restu Jernih Sdn Bhd; 

• his 99.99% equity interest in Kelana Ventures Sdn Bhd; 

• his 99.99% equity interest in Indra Cita, which has a 100% equity interest in Seaport Terminal (Johore) Sdn Bhd, which in turn has a 

4.07% equity interest in Tradewinds (M) Berhad. 

(5) Deemed interested pursuant to Section 6A of the Act by virtue of its interest in Tradewinds (M) Berhad. 

232 


DIRECTORS’ SHAREHOLDINGS 

No. Name of Directors Shareholdings % 

1 DATO’ WIRA SYED ABDUL JABBAR BIN SYED HASSAN 15,000 0.00 

2 OOI TEIK HUAT – 0.00 

3 PAKHRUDDIN BIN SULAIMAN 9,000 0.00 

4 BAKRY BIN HAMZAH – 0.00 

5 CHUAH SEONG TAT @ CHUAH CHEE TAT – 0.00 

6 MOHD NAZRI BIN MD. SHARIFF – 0.00 

TOTAL 24,000 0.00 


Annual Report 2010

ANALySIS Of IRREDEEmABLE cONvERTIBLE 

uNSEcuRED LOAN STOckS (IcuLS) (IcuLS 2006/2016) AS AT 25 APRIL 2011 

ANALYSIS BY SIZE OF ICULS HOLDINGS 

Category No. of ICULS Holders % No. of ICULS % 

Less than 100 – – – 0.00 

100 – 1,000 99 99.00 10,000 0.01 

1,001 – 10,000 – – – 0.00 

10,001 – 100,000 – – – 0.00 

100,001 to less than 5% of issued ICULS – – – 0.00 

5% and above of issued ICULS 1 1.00 159,990,000 99.99 

TOTAL 100 100.00 160,000,000 100.00 

ANALYSIS OF OWNERSHIP OF ICULS HOLDINGS 


No. of ICULS Holders No. of ICULS Percentage (%) 

Category of Malaysian 

Malaysian 

Malaysian 

ICULS Holders 

Foreign 

Foreign 

Bumi Non-Bumi Bumi Non-Bumi Bumi Non-Bumi 



Foreign 

1. Individual 82 16 0 8,200 1,600 0 0.01 0.00 0.00 

2. Body Corporate 

a) Banks/Finance 0 0 0 0 0 0 0.00 0.00 0.00 

Companies 

b) Investment Trusts/ 0 0 0 0 0 0 0.00 0.00 0.00 

Foundation/Charities 

c) Other Types of 0 0 0 0 0 0 0.00 0.00 0.00 

Companies 

3. Government Agencies/ 0 0 0 0 0 0 0.00 0.00 0.00 

Institutions 

4. Nominees 1 1 0 159,990,000 200 0 99.99 0.00 0.00 

5. Others 0 0 0 0 0 0 0.00 0.00 0.00 

TOTAL 83 17 0 159,998,200 1,800 0 100.00 0.00 0.00 

233

234 


ANALySIS Of IRREDEEmABLE cONvERTIBLE 

uNSEcuRED LOAN STOckS (IcuLS) (IcuLS 2006/2016) AS AT 25 APRIL 2011 

LIST OF THIRTY (30) LARGEST ICULS HOLDERS 

No. Names ICULS Holdings % 


PLEDGED SECURITIES ACCOUNT FOR TRADEWINDS (M) BERHAD (414011604023) 

2. ALLIANCEGROUP NOMINEES (TEMPATAN) SDN BHD 200 0.00 

PLEDGED SECURITIES ACCOUNT FOR LEE CHONG HAI 

3. CORNELIA ANAK STARLING 100 0.00 

4. CHEW SAY SIONG 100 0.00 

5. ZALINA BINTI ALI 100 0.00 

6. BADLISHAH BIN ABDUL RAHIM 100 0.00 

7. SAHARI BIN AMAT 100 0.00 

8. JOHARI BIN MOHD YUSOF 100 0.00 

9. ATI SURYA BINTI LEHAM 100 0.00 

10. ROSFADZILLAH BINTI OTHMAN 100 0.00 

11. NOBRI @ NOR AMRI BIN ARIFFIN 100 0.00 

12. RAJA ZAIDATUL AKHMAR BINTI RAJA MOKHTAR 100 0.00 

13. LOH MENG CHEE 100 0.00 

14. YEW PUAI LENG 100 0.00 

15. ZAINUDIN BIN MOHD YATIM 100 0.00 

16. MAHPUZ BIN JAWADI 100 0.00 

17. SALINA BINTI MOHAMED 100 0.00 

18. NORA’AZIYAN BINTI NODIN 100 0.00 

19. ROZIHAN BINTI MAT HUSSEIN 100 0.00 

20. KHOO PAO YIN 100 0.00 

21. ZABIDAH BINTI OTHMAN 100 0.00 

22. LAILY NABSIAH BINTI MOHD HAKI 100 0.00 

23. LAI SEY MIN 100 0.00 

24. LIM POH YIAN 100 0.00 

25. ROHAYATI BINTI SAIDIN 100 0.00 

26. ABDUL HALIM BIN ABDUL LATIFF 100 0.00 

27. YAP SIEW FONG 100 0.00 

28. LEE WEN GIAT 100 0.00 

29. ZAHUDIN BIN ISMAIL 100 0.00 

30. AZMAN BIN AZIZ 100 0.00 

TOTAL 159,993,000 100.00 


Annual Report 2010

SUBSTANTIAL ICULS HOLDER 

Name Direct Interest Indirect Interest 

No. of No. of 

Total % 

of ICULS 

ICULS Held % ICULS Held % Holdings 

MAYBAN NOMINEES (TEMPATAN) SDN BHD 

PLEDGED SECURITIES ACCOUNT 

FOR TRADEWINDS (M) BERHAD 159,990,000 99.99 - - 99.99 

DIRECTORS’ ICULS HOLDINGS 


No. Name of Directors ICULS Holdings % 

1 DATO’ WIRA SYED ABDUL JABBAR BIN SYED HASSAN – 0.00 

2 OOI TEIK HUAT – 0.00 

3 PAKHRUDDIN BIN SULAIMAN – 0.00 

4 BAKRY BIN HAMZAH – 0.00 

5 CHUAH SEONG TAT @ CHUAH CHEE TAT – 0.00 

6 MOHD NAZRI BIN MD. SHARIFF – 0.00 



235

236 


DIREcTORy 

Of gROuP OPERATION 

TRADEWINDS PLANTATION 

BERHAD 




Tel : 03-2177 9999 

Fax : 03-2161 1701 


MANAGEMENT SDN BHD 




Tel : 03-2177 9999 

Fax : 03-2161 1701 


ACADEMY 

No. 27, 1st Floor 

Lorong Endah Timur 3 

Jalan Teku, 96000 Sibu 

Sarawak 

Tel : 084-319 248/318 248 

Fax : 084-317 248 

TRADEWINDS RESEARCH & 

DEVELOPMENT CENTRE 

No. 29, Ground Floor 

Lorong Endah Timur 3 

Jalan Teku, 96000 Sibu 

Sarawak 

Tel : 084-346 213/322 213 

Fax : 084-349 281 



KEDAH PROJECT 

Ladang Batu Hitam 

Ladang Bukit Ketapang 

Ladang Durian Burung 

Ladang Sungai Seraya 

Ladang Sungai Tekai 

Ladang Tanah Merah 

Ladang Sungai Ahning 

KM 45, Jalan Padang Sanai 

06300 Kuala Nerang 

Kedah 

Tel : 04-790 4113 (Batu Hitam, 

Tanah Merah & 

Sg. Ahning) 

04-790 4136 (Bkt Ketapang & 

Sg. Tekai) 

04-790 4134 (Sg. Seraya) 

04-794 0129 (Durian Burung) 

Fax : 04-786 4854 (Batu Hitam, 

Bkt Ketapang, 

Sg. Seraya, 

Tanah Merah, 

Sg. Tekai, 

Sg. Ahning & 

Durian Burung) 

NORTHERN PENINSULAR 

REGION 

Regional Office 

1st Floor, Lot No. PT 7817 

Taman Mesra 

Jalan Persiaran Raya 

18300 Gua Musang 

Kelantan 

Tel : 09-912 1273 

Fax : 09-913 1373 

Ladang Sungai Relai (North) 

Ladang Sungai Relai (South) 

Ladang Sungai Relai (East) 

Peti Surat 42 

Pos Besar Gua Musang 

18300 Gua Musang, Kelantan 

Tel : 09-915 0204 (Sg. Relai North) 

09-915 0200 (Sg. Relai South) 

09-915 0201 (Sg. Relai East) 

Fax : 09-915 0205 (Sg. Relai North) 

: 09-915 0203 (Sg. Relai South/East) 

Ladang Serasa 

Ladang Sg. Bayu 

Serasa Palm Oil Mill 

Peti Surat 12 

18000 Kuala Krai 

Kelantan 

Tel : 019-959 1810 (Serasa) 

019-983 0256 (Sg. Bayu) 

019-917 9603 

09-914 0603 (Serasa Palm Oil Mill) 

Fax : 019-953 5520 (Serasa) 

019-984 0256 (Sg. Bayu) 

019-983 0674 (Serasa Palm Oil Mill) 

Ladang Mawar 

Ladang Sri Angkasa 

Ladang Chendana 

Peti Surat 40 

Bandar Seri Bandi 

24000 Kemaman 

Terengganu 

Tel : 09-867 5612 

Fax : 09-867 5613 

Ladang Sawit Cherul 

Ladang Ibok 

Ladang Perkasa 

Ladang Bukit Sah 

Peti Surat 40 

24000 Kemaman 

Terengganu 

Tel: 09-867 5551 

Fax: 09-867 5552

SOUTHERN PENINSULAR 

REGION 


Komplek Sisek 

KM 20 Lebuhraya 

Kota Tinggi-Kluang 

81900 Kota Tinggi 

Johor 

Tel : 07-889 481/84/85 

Fax : 07-889 2553 

Ladang Jaya 

Peti Surat 22 

Bandar Seri Perani 


Johor 

Tel : 07-891 1158 

Fax : 07-891 1792 

Ladang Ulu Papan 

Peti Surat 66 

Bandar Mas 


Johor 

Tel : 07-823 6070 

Fax : 07-823 5660 

Ladang Sg. Lebak, Peti Surat 8 

Ladang Sg. Kachur, Peti Surat 11 

Ladang Semai Segar, Peti Surat 11 

Bandar Petri Jaya 


Johor 

Tel : 07-890 4118 (Sg. Kachur) 

07-890 4804 (Sg. Lebak) 

07-890 4118 (Semai Segar) 

Fax : 07-890 4001 (Sg. Kachur) 

07-890 4144 (Sg. Lebak) 

07-890 4118 (Semai Segar) 

Sg. Kachur Palm Oil Mill 

Peti Surat 48 

KM 22 Jalan Kota Tinggi-Kluang 


Johor 

Tel : 07-890 5810/5052 

Fax : 07-890 4887 

Ladang Penawar 

Peti Surat 10 

Bandar Penawar 


Johor 

Tel : 07-832 8291 

Fax : 07-832 8253 

Ladang Sisek 

Peti Surat 16 


Johor 

Tel : 07-889 2220 

Fax : 07-889 2220 

Animal Husbandry & Cultivation 

Unit 

Komplek Sisek 

KM 20 Lebuhraya 

Kota Tinggi-Kluang 


Johor 

Tel : 07-889 4585 

Fax : 07-889 2553 

Ladang Air Manis 

KM 51, JB-Air Hitam Road 

Peti Surat 110 

81000 Kulai 

Johor 

Tel : 07-656 1246 

Fax : 07-656 1685 


Ladang Ulu Sebol A 

Peti Surat 26 

81440 Bandar Tenggara 

Johor 

Tel : 07-684 0010 

Fax : 07-896 1260 

Ladang Ulu Sebol B 

Peti Surat 25 


Johor 

Tel : 07- 896 1235 

Fax : 07- 896 1260 

Ulu Sebol Palm Oil Mill 

Karung Berkunci 101 


Johor 

Tel : 07- 896 1211 

Fax : 07- 896 1263 

Ladang Agromaju 

Peti Surat 8 


Johor 

Tel : 07-896 5451 

Fax : 07-896 5451 

Ladang Pakloh 

Batu 11 ½ Jalan Mersing 

Karung Berkunci 516 

86009 Kluang 

Johor 

Tel : 07-774 6255 

Fax : 07-774 6733 

Ladang Pelangi 

Ladang Sembrong Kiri 

Peti Surat 15 

86700 Kahang 

Kluang 

Johor 

Tel : 07-780 0064 

Fax : 07-780 0068 



237

238 


DIREcTORy 

Of gROuP OPERATION 

KUCHING REGION 


Level 23, Gateway Kuching 

No.9, Jalan Bukit Mata 

93100 Kuching 

Sarawak 

Tel : 082-412 909/413 909 

Fax : 082-248 909 

Ladang Gemilang 

Ladang Melur 


94700 Serian 

Sarawak 

Tel : 082-895 969 (Gemilang) 

Fax : 082-895 969 (Gemilang) 

082-325 531 (Melur) 

Ladang Sg. Krang 


94700 Serian 

Sarawak 

Tel : 082-895 193 

Fax : 082-895 193 

Ladang Sg. Mangga 

Ladang Tg. Melano 


94700 Serian 

Sarawak 

Tel : 082-895 182 (Sg. Mangga) 

082-895 405 (Tg. Melano) 

Fax : 082-895 182 (Sg. Mangga) 

082-895 405 (Tg. Melano) 

Melur Gemilang Palm Oil Mill 


94700 Serian 

Sarawak 

Tel : 082-895 130 

Fax : 082-896 182 



Ladang Simunjan 

Ladang Ladong 

Ladang Sebuyau 

Peti Surat 24 

94800 Simunjan 

Sarawak 

Tel : 082-809 089 

Fax : 082-809 113 

Ladang Sg. Tersak 


94700 Serian 

Sarawak 

Tel : 082-895 624 

Fax : 082-895 627 

SIBU REGION 



96007 Sibu, Sarawak 

Tel : 084-350 454/455 

Fax : 084-350 453 

Ladang Lingga 

KM 11.5, Off Jalan Tanjung Asam 


95700 Betong 

Sarawak 

Tel : 083-480 102 

Fax : 083-480 139 

Ladang Pelitanah 1 

Ladang Pelitanah 2 

CDT 174 

96000 Sibu 

Sarawak 

Tel : 084-366 957 

Fax : 084-366 782 

MUKAH REGION 


No. 92, 1st Floor 

Lot 1167, Block E 

Mukah New Township 

Phase II 

96400 Mukah, Sarawak 

Tel : 084-874053 

Fax : 084-874062 

Ladang Judan 

Ladang Petian 

Judan Palm Oil Mill 


96400 Mukah 

Sarawak 

Tel : 084-875 413 (Judan) 

084-875 432 (Petian) 

084-875 792 (Judan Palm Oil 

Mill) 

Fax : 084-875 022 (Judan Palm Oil 

Mill) 

Ladang Tanjung Alan 1 

Ladang Tanjung Alan 2 

Matu-Daro Road 

c/o Post Office 

96200 Daro 

Sarawak 

Tel : 084-813 002 

Fax : 084-813 004 

Ladang Jemoreng 1 

Ladang Jemoreng 2 

c/o Post Office 

96200 Daro 

Sarawak 

Tel : 084-823 209 

Fax : 084-823 210

MIRI REGION 


c/o Ladang Binu 


98009 Miri, Sarawak 

Tel : 085-739 708 

Fax : 085-739 011 

Ladang Binu 

Ladang Jelai 

Binu Palm Oil Mill 


98008 Miri 

Sarawak 

Tel : 085-710 308 (Binu) 

085-710 797 (Jelai) 

085-739 288 (Binu Palm Oil Mill) 

Fax : 085-710 217 (Binu & Jelai) 

085-739 287 (Binu Palm Oil Mill) 

Ladang Kuala Suai 

Ladang Tg. Payung 

Ladang Mutiara 


Pejabat Pos Mini Batu Niah 

Batu Niah Bazaar 

98200 Miri 

Sarawak 

Tel : 085-739 257 (Kuala Suai) 

085-739 002 (Tg. Payung) 

085-739 334 (Mutiara) 

Fax : 085-739 257 (Kuala Suai) 

085-739 573 (Tg. Payung) 

085-739 334 (Mutiara) 

Ladang Sg. Klad 

Ladang Sibuti 


98009 Miri 

Sarawak 

Tel : 085-739 901 (Sg. Klad) 

085-739 909 (Sibuti) 

Fax : 085-739 811 (Sg. Klad) 

085-739 908 (Sibuti) 

SABAH/ LAWAS REGION 


1st Floor, Lot 26 MDLD 3291 

Fajar Centre 

91100 Lahad Datu 

Sabah 

Tel : 089-881 051/052 

Fax : 089-881 053 

Ladang Permai 

Ladang Tengah Nipah 

Permai Palm Oil Mill 


91117 Lahad Datu 

Sabah 

Tel : 089-887 063 (Permai) 

089-887 064 (Tengah Nipah) 

089-886 011 

(Permai Palm Oil Mill) 

Fax : 089-887 063 (Permai) 

089-887 064 (Tengah Nipah) 

089-886 012 

(Permai Palm Oil Mill) 

Ladang Batu Putih 

Ladang Tinabau 

Batu Putih Palm Oil Mill 

WDT 125 

90200 Kota Kinabatangan 

Sandakan 

Sabah 

Tel : 089-566 111 (Batu Putih) 

089-566 114 (Tinabau) 

089-565 963 

(Batu Putih Palm Oil Mill) 

Fax : 089-566 188 (Batu Putih) 

089-566 115 (Tinabau) 

089-677 178 

(Batu Putih Palm Oil Mill) 


Ladang Trusan 

Ladang Intan 

KM 15, Jalan Trusan 


98857 Lawas 

Sarawak 

Tel : 085-282 030 (Ladang Trusan) 

019-854 6440 (Ladang Intan) 

Fax : 085-282 030 (Ladang Trusan) 

085-282 030 (Ladang Intan) 

Ladang Merapok 

KM25, Jalan Lawas-Merapok 


98857 Lawas 

Sarawak 

Tel : 085-282 062 

Fax : 085-282 062 

Trusan Palm Oil Mill 

KM 15, Jalan Trusan 


98857 Lawas 

Sarawak 

Tel : 085-282 120 

Fax : 085-282 788 



239

240 


Annual Report 2010

Proxy Form 

I / We __________________________________________________________________ NRIC/Passport No.: _________________________________ 

(FULL NAME IN BLOCK LETTERS) 

of ___________________________________________________________________________________________________________________________ 

(ADDRESS IN FULL) 

being a member of Tradewinds Plantation Berhad, hereby appoint “THE CHAIRMAN OF THE MEETING” or _________________________ 

__________________________________________________________________________ NRIC/Passport No.:__________________________________ 

(FULL NAME IN BLOCK LETTERS) 

of ___________________________________________________________________________________________________________________________ 

(ADDRESS IN FULL) 

as my/our proxy/ies to vote for me/us and on my/our behalf at the SEVENTH ANNUAL GENERAL MEETING of the Company to be held 

at MAHKOTA BALLROOM 2, BALLROOM LEVEL, HOTEL ISTANA KUALA LUMPUR, 73 JALAN RAJA CHULAN, 50200 KUALA 

LUMPUR on TUESDAY, 21 JUNE 2011 at 9.30 a.m. 

(* Delete the words “THE CHAIRMAN OF THE MEETING” if you wish to appoint some other person(s) to be your proxy.) 

My/Our Proxy is to vote as indicated below:- 

Ordinary Resolution 1 To receive and adopt the Audited Financial Statements for the financial year 

ended 31 December 2010 

Ordinary Resolution 2 To declare a Final Dividend of 5% per share less 25% income tax for the 

financial year ended 31 December 2010 

Ordinary Resolution 3 To approve the Directors’ fees for the financial year ended 31 December 2010 

Ordinary Resolution 4 To re-elect Encik Bakry bin Hamzah as Director 

Ordinary Resolution 5 To re-elect Encik Mohd Nazri bin Md. Shariff as Director 

Ordinary Resolution 6 To re-appoint Dato’ Wira Syed Abdul Jabbar bin Syed Hassan as Director 

Ordinary Resolution 7 To appoint Messrs Deloitte KassimChan as Auditors 

Special Business 

Ordinary Resolution 8 To approve the recurrent related party transactions of a revenue or trading 

nature in respect of Category A Mandate 

Ordinary Resolution 9 To approve the recurrent related party transactions of a revenue or trading 

nature in respect of Category B Mandate 

FOR AGAINST 

(Please indicate with an “X” in the appropriate spaces provided above as to how you wish your votes to be cast. If you do not do so, the proxy/ies 

will vote or abstain from voting at his/her/their discretion). 

Dated this ______________________day of _____________________2011. 

Signature of Member(s)/Common Seal of Shareholder No. of Shares Held 

Notes: 

1. A member of the Company entitled to attend and 

vote at the Meeting is entitled to appoint any person 

to be his proxy without limitation to attend and vote 

in his stead and the provisions of Section 149(1)(a) 

and (b) of the Companies Act, 1965 shall not apply 

to the Company. A Member shall not be entitled to 

appoint more than two (2) proxies to attend and vote 

at the same meeting. Where a Member appoints two 

(2) proxies, the appointments shall be invalid unless 

he specifies the proportions of his holdings to be 

represented by each proxy. A proxy may but need 

not be a member of the Company. 

2. Where a member of the Company is an authorised 

nominee as defined under the Central Depositories 

Act, it may appoint at least one (1) proxy in respect 

of each securities account it holds with ordinary 

shares of the Company standing to the credit of the 

said securities account. 

3. To be valid, this Proxy Form must be deposited with 

the Share Registrar of the Company, Symphony 

Share Registrars Sdn Bhd, at Level 6, Symphony 

House, Pusat Dagangan Dana 1, Jalan PJU 1A/46, 

47301 Petaling Jaya, Selangor, not less than fourtyeight 

(48) hours before the time fixed for holding the 

Meeting or at any adjournment thereof. 

4. In the case of a corporate member, the corporation 

may by resolution of its directors or other governing 

body, if it is a Member of the company, authorise 

such person as it thinks fit to act as its representative 

either at a particular meeting or at all meetings of the 

Company or of any class of Members, and a person 

so authorised shall in accordance with his authority 

and until his authority is revoked by the corporation 

be entitled to exercise it as if it were an individual 

Member of the Company. 

5. The instrument appointing a proxy shall be in writing 

under the hand of the appointer or of his attorney 

duly authorised in writing or, if the appointer is a 

corporation, whether under its seal or under the 

hand of an officer or attorney duly authorised. 

6. Unless voting instructions are indicated in the spaces 

provided above, the proxy may vote as he/she 

thinks fit.

fold here 

fold here 

Annual General Meeting 

21 June 2011 

Symphony Share Registrars Sdn Bhd 

Level 6, Symphony House 

Pusat Dagangan Dana 1 

Jalan PJU 1A/46 

47301 Petaling Jaya 

Selangor 

Affix 

stamp 

here

FORGING AHEAD - Tradewinds Plantation Berhad

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